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#6- Charles Read
9 Plays4 years ago
Charles Read is a CPA, IRS Advisory Council member, IRS Watchdog, and Small Business Advocate who practices in the United States Tax Court. Charles is a Vietnam War combat veteran and a decorated United States Marine Corps sergeant. He and his partner, Ruth, co-founded Custom Payroll Associates, Inc. and worked together . Charles uses his education, experience, and hard-won expertise to make connections with people at all levels of an organization. As an advisor and solutions architect, he helps businesses tackle problems by bringing about positive change.Charles Read graduated from the University of North Texas with a BBA and an MBA. Charles has published four books and is working on his fifth. He lectured small and large groups and hosted live and on-demand webinars for HR.com. He takes a number of continuing professional education courses each year as part of his CPA requirements.
Website: https://jimboparis.com/
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Transcript
Introduction and Guest Background
00:00:05
Speaker
I am Jimbo Parris and you are listening to the Jimbo Parris Show.
00:00:15
Speaker
I'm gonna get like a brief summary of who you are. Sure. Well, you know, I'm a CPA, MBA, US Tax Corps practitioner. After leaving high school, I joined the United States Marine Corps, spent four years, including two years overseas, and a tour in Vietnam. Came back, was stationed in Kansas City, met my wife, married her with five children. It worked. Don't ask me how, but it worked. You know, I claim insanity. Went to school, got my degrees, went to work for major corporations.
00:00:43
Speaker
I realized when I was in my early 40s that I was never going to run a major corporation. I didn't have the political skills. You've got to be able to stab them in the back and toss them off the ladder to get to the top. I can't do that. I started my own company so I'd have a company to run. I grew up in a family business. I started the business with my wife. I thought that was normal. It's not.
00:01:07
Speaker
worked for us. We were married for 45 years until she passed here six years ago. So that's the short synopsis.
Career Motivation and Niche Finding
00:01:15
Speaker
Right. So can we kind of begin on what motivated you to just get into a lifestyle of finances and accounting and money? Well, you know, that's a good question because I had gone to school, figured on business, and started taking some accounting courses and liked them.
00:01:37
Speaker
And so I started taking some more. And I had a choice toward the end of my undergraduate to make a decision whether to go into law or heavily more into business. And finances were such that business and an MBA became the more viable option. So I went and got my master's in business, which really was a master's in taxation, but it was labeled as an MBA, which is what I wanted.
00:02:04
Speaker
I like tax, I like working with that. You know, a CPA is a professional nitpicker, okay? Numbers, numbers, numbers, numbers, not too many people. And that was a lot of fun for me. As I've gotten older, I like people less, but you know, I'm getting old. So it was just that I liked that in college and I was able to get, you know, 50 something hours of college accounting and tax.
00:02:32
Speaker
I'd grown up around finances and insurance, and I was a stock analyst when I was 14 and this kind of thing. So numbers were always fun, and it just grew into it. I found my niche. If you find something you like to do and you never have to work a day in your life,
00:02:55
Speaker
So, you know, I like what I do. I like the accounting. I love the payroll. Exciting than accounting because I'm fighting with the IRS for my clients all the time. So you were kind of talking a lot about engaging with people a lot more than money as you're used to. Can you explain more about that sort of transition you had? Because you went from stocks to money to more people focus, you know, that's a lot of different things.
Valuing People and Client Relationships
00:03:24
Speaker
Well, as I grew up, I realized how important people really are. My marriage was a good marriage. My wife taught me a lot. She was far more of a people person in the beginning than I was. Everybody loved my wife. Even people she didn't like thought of her as their best friend.
00:03:48
Speaker
which I found terribly amusing. But being around her for 45 years and with her influence, I learned to better understand people, get along with them better.
00:04:03
Speaker
You know, in the military, everybody, you either jump for them or they jump for you. I mean, the hierarchy is absolute. It comes down to the hour of the day that you got your promotion. If you got yours an hour before the other guy, you're his superior.
00:04:20
Speaker
which is insane by itself. So with her guidance, I learned a lot. I learned better how to deal with people, how to supervise them, how to work with them. In a business, really, your people are your asset.
00:04:39
Speaker
Even as a CPA, I've got a dozen people that work for me running in my payroll company. I couldn't do the work without them. I absolutely would be out of business. So I care about them. I worry about them. They become almost like family and my clients. I've got clients that have been with me for 30 years. After 30 years doing business with somebody and being there in pocketbook,
00:05:04
Speaker
several times a month, you better be friends with them, or they're going to go someplace else. People are great, and a lot of people are. There are some, and I've learned that too.
00:05:21
Speaker
people who vex me, vexes people, I stay away from them. I don't deal with them. We've had over the years a few clients. We've had, you know, the old clients always write, well, up until the point you fire them. There's some clients that want more service and more handholding and more of your time than they're willing to pay for. And so you have to make a choice. Am I going to
00:05:45
Speaker
go broke handling these people or am I going to move on? I've had half a dozen over the years, I've had to move on because they just were vexatious. It's life. Hopefully, they found somebody that they could deal with. Speaking of clients, because you mentioned clients before, what type of service do you think you provide for clients that's different compared to other accounting and finance-based businesses?
Unique Client Services and Compliance
00:06:11
Speaker
Well, in the payroll business, our competitors are either very big or very small. There's not too many in the middle, and we're kind of in the middle. But as a CPA, I take a 2848. It's an IRS form that's a power of attorney. It's a limited power of attorney. And it allows me as a CPA to represent my clients and advocate for them to the Internal Revenue Service and to the states.
00:06:40
Speaker
Very, very few of my clients do that. And because of that, our real difference is compliance. We're compliance experts. I deal with the IRS. I was on the IRS Advisory Council for three years meeting with all the commissioner and the commissioners of the various business entities and solving problems for them, not by myself. There were 15, 20 of us, but we worked on IRS problems.
00:07:09
Speaker
And that allowed me to meet people. I know the chief of appeals. I know the head of OPR. I know all the commissioners for the various business entities. I can call them if I need to. That allows me to do things for my clients. We had one problem, a penalty situation was $95,000. It was bogus, but it took us nine years to get it abated.
00:07:36
Speaker
But finally, in desperation, I called Chief of Appeals because I couldn't get the right person to call me. And she said, I can call you. He called me that afternoon. And months later, they sent my client a $400 refund instead of a $95,000 bill. He was happy.
00:07:56
Speaker
So the compliance thing that we can apply, if you call one of our major competitors and say, I need to talk to a CPA about a tax situation, they don't have CPAs available. They'll tell you to call your own CPA. Well, if your own CPA was a payroll expert, he'd be doing your payroll for you. He's not. So you're going to pay him to come in and learn what's going on and hopefully learn enough to solve the problem.
00:08:22
Speaker
We do it every day. And it's part of our fee. So you don't pay more, but you get the compliance on top. It's like buying insurance. You've got car insurance. People buy insurance for the house, insurance for their life. Yeah. We're paying insurance. When it goes wrong, we can fix it. It's a lot of good stuff there, you know? And another thing is, why is it that, you know, what do you think is the main thing most people get wrong about what you do?
00:08:50
Speaker
Well, we seem unnecessary at times to some people. We seem underpriced to other people. People say, well, I can do my own payroll. And if they work at it, they can. But when they look at what we charge them compared to the time they spend and analyze that and say, can I spend this time on my business, getting new clients, improving what I'm doing, and so on?
00:09:13
Speaker
we become free and then the average, this is something people don't see, the average small business gets penalized, I'm sorry, 40% of all small businesses get penalized by the IRS every year to the tune of about $800, which is about what we charge for a year. So, you know, and many times we're free, we'll fix that penalty and you won't have to pay it because if you don't know how to fix that penalty,
00:09:41
Speaker
When you're dealing with the IRS, the example I use, when I grew up, Pele was the premier soccer player in the world, a Brazilian. I don't know who it is today. Pele's a superb athlete, but if you put him in a New York Yankees uniform at second base, he's lost. He's still a great athlete, but he doesn't know the equipment, the field, the rules, nothing.
00:10:06
Speaker
You take a businessman who is very successful at what he does, and you say, go deal with the IRS. He's like Pele at Yankee Stadium on second base. He's lost. We do it every day. Can't run my client's business. I can't run the dog grooming salon. I can't run the generator company, the garage floor conditioning company. I can't run the construction company, on and on and on. I don't know these things.
00:10:32
Speaker
but I know accounting, tax and payroll. And I do that every day. So when you say, well, you know, I can do it.
00:10:40
Speaker
Well, you know, I can probably do your company too. Give me 20 years of experience and the right education. Yeah, I can do what you do. So why do you insult me and tell me that, you know, you can do what I do just off the cuff? Because there's a lot more to it. The law is very complex and there's 50 states. There's actually about 15,000 taxing authorities in the US that tax payroll one way or another. And we deal with most of them.
00:11:12
Speaker
And another thing that I'm curious about is, do you handle more individual-based issues or more business-related situations?
Business Scalability and Educational Resources
00:11:25
Speaker
In payroll, it's almost all business because sole proprietors don't take payroll. They're not allowed to. It's tax law. They take draws instead. So on the payroll side, they have to be incorporated even if they're just them. And we have some. They're a lawyer or a doctor or an entrepreneur that it's just them. And they pay their payroll because they're incorporated.
00:11:50
Speaker
So we do that, but our average client's about 17 employees, and most of our clients are, the vast majority of our clients are under 50. We have some that run into the multiple hundreds of client, employees, and, you know, we're glad to have them. But at some point, somewhere around 500 employees, it becomes cost-effective to take it in-house and hire a professional to do it because
00:12:20
Speaker
As you add employees, there's always lots of little problems. So as you build an HR system, an HR department, then you add a payroll department, either under HR or under accounting, and you do it in-house and you buy the software. For the small business with 15, 20, 30 people, you know, we spend tens of thousands of dollars a year on software.
00:12:43
Speaker
It's just not cost effective for a small business to do that. We're able to provide software as a service and provide state-of-the-art software and expertise. You know, we're experts. You know, that's my newest book, the payroll book. We wrote the book on payroll, guys. So, you know, if you've got
00:13:13
Speaker
heroes what we do you know day in and day out now you wrote that book right who is that book now for yes sir the uh... the book i wrote uh... it came out and while he published it came out last year in august it's twenty nine ninety five from it's available on amazon barnes and noble you know from fine bookstores everywhere
00:13:38
Speaker
What it is, is that 30 years of payroll experience distilled down to 90,000 words. It's a reference guide. It's not something you sit down and read fine. But when you have a payroll question, it answers most of them. And my phone number's in there, so if there's one that doesn't answer, give me a call. And it must have been a very crazy transition. You went from investing to general accounting to
00:14:04
Speaker
You know, working with the IRS and your own business, did you ever have to change your mind frame anytime or did you just naturally fall into each other? Oh, absolutely. Everything changes and technology changes. But what I found for me is that everything I learned
00:14:23
Speaker
whether it be, you know, I've been a stockbroker, I've been a lot of things. You know, in my sixties I became a U.S. Tax Court practitioner because the IRS was getting harder to deal with, so I'm able to go to U.S. Tax Court, even though I'm not an attorney, and represent my clients. There's about two hundred of us in the country that can do that. It's an odd federal thing, but
00:14:49
Speaker
I actually have a U.S. Tax Court bar card. So, you know, I'm a counselor at the Tax Court. All these things
00:14:58
Speaker
make me better able to represent my clients and solve problems and understand things. Knowledge is never wasted. No knowledge is ever wasted. So everything I read, everything I study, everything I learn makes me better able to run my business, handle my clients, work with my clients, solve their problems, deal with the IRS, deal with the states, everything.
00:15:24
Speaker
And it may not be this week, this month, this year, but I've used things that I learned 50 years ago in today's dealings. Some things I've learned are obsolete, but you know, I've learned what's obsolete. So that's an important thing to know too. Now, I kind of went into how your clients wanted you, but who is the specific, who are, what's the biggest crowd of people that actually come to you and ask you for help?
00:15:54
Speaker
Well, it has to be a business. You have to have employees or contractors. We handle contractors too. We get a lot of people who just, they get a notice from the IRS. They don't know what they did. They don't know what they did wrong. We get a lot of that. We get clients from the major companies that have call centers and you can never talk to the same person twice. My clients know the problem and they can't solve it by people. They can talk to me and it's my company, so I'll fix it.
00:16:26
Speaker
So they come from a lot of places. We get a lot of referrals from our existing clients. We don't lose. So we get good referrals. We have a sales and marketing staff. The book is helped. And we're trying to grow like a lot of businesses. You either grow or you die. So we're still trying to grow our business and be successful.
00:16:54
Speaker
You know, I'm still not sure I want to, I'm still not sure I know what I want to be when I grow up, but you know, I'll figure it out. You know, what's one thing that you would have told your younger self to do to get to where you are right now? Oh, there's a couple of things. First of all, if I'd known I was going to live this long, I'd have taken better care of myself.
00:17:19
Speaker
But I would have saved more. I mean, just $10 a week and hell, I'd be rich today, really rich. And I wish coming out of high school that I better understood people. And that's been the key, is learning about people and learning to understand people. People are so, everybody's unique.
00:17:44
Speaker
George Washington Crane, who was an author and a doctor and a lot of things, used to write a column. And in his column, he said, to get along with people, just imagine that tattooed across their chest, it says, I am important because they think they are. And they are important to somebody, to themselves and nobody else. And if you treat them that way, they'll respond much better than if you treat them like,
00:18:13
Speaker
They're not important. They're not good. They're not valuable because everybody is at least somebody. And so treat them that way. And it makes life easier for them. You know, be nice to them. Practice the golden rule. All these things, they work. They make your life easier. They make your life more profitable.
00:18:32
Speaker
They make for better sleep, okay? You're not worried about things at night, so I wish I'd known that better. My father, I couldn't work for him. We didn't get along well. He could schmooze people, but he never passed it on, and I learned it the hard way.
00:18:54
Speaker
You know, I go back and look at his example, I can do what he did now, but he never taught me how growing up. And that was my fault for not learning. So life goes on. And when you're running your business, did you ever think to yourself, am I doing the right thing?
Journey to Entrepreneurship and Influences
00:19:12
Speaker
You know, did you ever have any doubts, any questions? Not about that business, not about being right. Go ahead. I'm sorry.
00:19:20
Speaker
And to add to that, what about your transition? Because I know a lot of successful entrepreneurs that have this transition from being a high acclimated college student to then running your own business or job to their own business. And that is a ridiculous transition. You know, how would you go from that expert headspace to now an owner and expert headspace?
00:19:43
Speaker
OK, I've never had any problem with running the business. I've always enjoyed business. Once I got into it, I've always known I wanted to be my own boss. Coming out of college, I went to work for major corporations. My first job out of college was Texas Instruments. And I was just a minor cog in a huge organization. And that wasn't fun.
00:20:06
Speaker
And I worked my way up and became, you know, system control and controller in various operations, CFO and so on. But I was still working for somebody else. And I'd grown up, as I said, in a family business. My father and mother worked together and it was their own business. It was from the moment I remember that they had a business. And so I grew up with that and I wanted the,
00:20:33
Speaker
Yeah, it's lonely at the top, but I wanted to make those decisions. I wanted to be that person in charge. I like that. And so I started my own and I ran with it. It's been 30 years now. I've had a great time. I enjoy coming to work every day. Have I made mistakes? Absolutely. Have I screwed things up? Absolutely. If I was perfect,
00:21:00
Speaker
I would not only be rich, but I'd be a movie star too. I mean, you know, but I'm neither. So yeah, it's those changes, those transitions. One of the, you know, I've had several major ones getting married as a major transition, particularly to a one with five kids. That was a life-changing experience.
00:21:25
Speaker
military, going from civilian life to military, then going from military back to civilian life. Because after four years in the Marine Corps, and all of a sudden, you don't have superiors telling you what to do. And every moment of your life is accounted for. All of a sudden, you're on your own again. So there's that, and then transition to college, college to work, work to entrepreneurship.
00:21:54
Speaker
I love being an entrepreneur. Now, for the first 20 years, I didn't take a vacation, but that's part of being an entrepreneur. No work-life balance, just work. Well, you have to love what you do as well. And who are some people in life that helped you grow that love that you had? Not just how you saw it, but people that showed you it. Well, obviously, I grew up
00:22:24
Speaker
in an environment where my parents worked and worked very hard and very long hours. So that was never a surprise. The Marine Corps taught me mission. Complete the mission. You've got to complete the mission.
00:22:39
Speaker
And then people like Tom Peters, a famous author in search of excellence and so on, I really liked his thought process, you know, more so than even Deming, because Peters was very much more of a people person as opposed to a systems person.
00:23:00
Speaker
And so I found that to be useful and uplifting. And so I've read all of Tom's books and attended a number of lectures and so on over the years. I find that his philosophy about business to be extremely useful to me. So he's my major source of business thought. Then I've read
00:23:26
Speaker
hundreds and hundreds of business books over the years. And hopefully I can get a nugget out of them when I read them. In the beginning, I got lots of nuggets. Well, a lot of them get repeated and repeated and repeated. So if I can find a new nugget and I still read business books, no knowledge is ever wasted, as I've said.
00:23:49
Speaker
What are some things that really taught you a lot about accounting to begin with, but more on a philosophical perspective? What were some real breaking points during your journey of knowledge? I will tell you the moment I really decided to become an accountant. It was a spring morning.
00:24:12
Speaker
and I'm on the third floor of the University of North Texas Business Building, and I am between classes. And the term depreciation probably doesn't mean much to you, but it's how you allocate asset value and life against the revenue generation. And I was troubled with the concept and rolling it over in my mind, and that spring morning,
00:24:40
Speaker
it all fell into place. And in my gut, I now understood what it was doing and how it worked. Intellectually, I could do it on paper, but it didn't make any sense until that moment. And at that moment, it sunk in. And it's at that moment that I really became an accountant.
00:25:05
Speaker
There's been lots of other moments of learning. For those of you in accounting, in school, you don't really learn it in school, you learned it on your first job. You learn all the textbook, but you really learn accounting in your first accounting job, I promise you. Speaking of learning accounting,
00:25:32
Speaker
What do you think makes you just different compared to an accountant next door? I mean, you can't really find so many accounts like you next door, but you kind of get what I'm saying, though.
Defining a Good Accountant
00:25:42
Speaker
Well, you know, in any industry, there's good practitioners and there's poor ones. There's good doctors and bad ones. There's good lawyers and bad lawyers. There's good accountants and bad accountants. An accountant that doesn't love what they're doing
00:25:59
Speaker
is not somebody you want to deal with, okay? I like accounting. I like tax. I like payroll. I'm a very analytical person. I'm a problem solver by nature, okay? It's one of the things I had to learn over time is I can't solve everybody's problems and don't try anymore. I pick and choose. But those are the people that make good accountants. My partner, who I sold the accounting practice to,
00:26:28
Speaker
is even worse than I am. But we're good ones. Good accountants are very political. They tend not to be peoplepersons.
00:26:38
Speaker
Okay, and that makes me a little unusual as an accountant because I've become over the years kind of a people person. Most good accountants like actuaries would prefer to work in an office by themselves and the work to come in one slot and go out another and have a private door to the parking lot. You know, they don't like people. So that's why accountants are hard to deal with. The biggest complaint
00:27:09
Speaker
that clients have about accountants, and I've heard this over and over over the years, is they don't return phone calls, which is insane. You got a client that has a problem, that's an opportunity to bill them. You ought to be calling them, because that's how you make money. But that's the biggest complaint about accountants, is they don't return phone calls. And I no longer understand that.
00:27:35
Speaker
So I think another thing that hit me, though, is that you said you were a problem solver. But to me, it sounded a little bit like an obsession in a sense, too, because did that problem solving need ever cause you to go overboard in your, you know, older times or? Cost me to marry a woman with five children. I think that's overboard. I was solving her problems.
00:27:58
Speaker
Yes, it can really be a time consumer. It can be a money consumer. It can ruin your life. You can't solve them all. And if you try, it's going to destroy you. And there's some problems that just aren't solvable, okay?
00:28:19
Speaker
I can't create world peace, I'm not gonna start, okay? I can't change the world. I do my little bit. I try to be a good person and run a nice business and take care of my employees, take care of my family, be a good citizen, vote, don't litter, pay my taxes, all these things.
00:28:47
Speaker
When you're in business and you have lots of clients, there's all kinds of problems that come in the door. And you've got to learn to pick and choose. If you don't, you're going to be constantly solving people's problems that aren't able to pay you, that consume your time, that ruin your life, that drive you crazy.
00:29:07
Speaker
And you can't do it all. You just can't do it. And if you try, you're going to go crazy. And when I was younger, I tried to solve problems all the time. And I've learned that you can't do it. And you just have to pick and choose. And sometimes it's very heart rendering. There's problems I would have liked to solve, but I don't have the money or the time. I try to give people, if I can,
00:29:36
Speaker
direction where they can go. Maybe they can call this they can call that, you know, and maybe they can get their problem solved that way. But most of them come down to get a second up and make it work. And I can't force people to do that either. And, you know, we always talk about, you know, your people skills. And I kind of can pick this up to you have a strong understanding of how a lot of people work.
00:30:04
Speaker
And I'm just thinking, was it ever difficult to kind of balance between these skills and your accounting skills at times? Like sometimes you would have to think, okay, this really isn't working in terms of my skills, but this is a good person. You know, did you ever? Yeah, I mean, I've had to.
00:30:26
Speaker
Not everybody's a fit for me. And I know that. And, you know, we lose clients from time to time. When I brought in my partner, we lost several clients who could work with me, but couldn't work with him. And that's part of it. And then, you know, I have people, I hire and fire people, my employees. They don't all work out. I try very hard to hire the right people, but it doesn't always work.
00:30:56
Speaker
For whatever reason, I make a mistake in hiring, basically is what it comes down to. I didn't understand them well enough to know that they would not be a fit or their life changes. And, you know, they no longer were who they are and it doesn't fit. And I hate that. I absolutely abhor firing people. Okay.
00:31:21
Speaker
The only thing I can say is I never fired anybody that didn't know it was coming. Because I counsel them, I talk to them, and what they need to do. And when they don't do it repeatedly,
00:31:39
Speaker
then I'll let them go. But it's never a surprise. And that's part of people's skills. Hiring people is very difficult. If firing people is technically easy, you're fired. But emotionally, it takes a toll on me and it takes a toll on them. I don't fire people. I learned years. I've been fired a few times and I hate that. I don't fire people on Friday afternoon. I fire them on Monday morning.
00:32:10
Speaker
So they can immediately go down and file for unemployment. It used to be they could get the Sunday paper and start perusing the employment ads and so on. They didn't have to go home and think about being fired all weekend before they could do anything. That's just miserable. So that's one of the few things I do. I haven't had to fire anybody in years, thank heavens.
00:32:32
Speaker
We all made it through COVID just fine. The thing is, we're bringing up a lot of these topics about the struggles within a business.
Entrepreneurial Challenges and Technology Impact
00:32:41
Speaker
What were your struggles specifically, but with the business now? What were some obstacles you had to get through before you got into your book and your client network? Your network probably wasn't like that at the start. You had to gather those people together.
00:32:56
Speaker
Well, it's marketing. It was my biggest thing, is learning to market and to sell myself and my skill set. I'm not a good marketer. I'm not a good, you know, I believe in what I do. And one-to-one, you sit down with me and, you know, I'm very
00:33:16
Speaker
you know, confident in what I do and how I do it and what we do and the fact that, you know, we're worth what we charge. But to go out and try to sell that to, you know, hundreds of people over and over and over again, just
00:33:32
Speaker
I can't do it. I have a real hard time with that. To be a good salesman, you have to wash off that rejection every morning. You have to be able to start fresh with no rejection. Mine builds up, and I've known that for many, many years. My sales capabilities are slender, and that's one of my downfalls.
00:33:54
Speaker
So getting the business grown and getting enough people in where it was sustainable and would continue to grow through referrals and so on. And now I have a marketing staff that, you know, the book is marketing, though it's very informative. We do podcasts, we do blogs, we do articles, we write press releases, we do all kinds of things because we offer,
00:34:23
Speaker
a wonderful service, in my opinion, at a great price. We're not unique, but we're pretty close to it, as far as I'm concerned. So we do great payroll work and compliance and expertise, which is hard to find. So it's all included in the package. So guys, you know.
00:34:49
Speaker
We take care of our clients. We love to. So marketing was my biggest thing. Money always is tight in the beginning. Time. I mean, you know, in the beginning I was doing accounting and payroll and working 80 hours a week or more. You know, as I said, there's no work-life balance for an entrepreneur. It's work. And hopefully, you know, you're married to somebody that understands that. My wife worked with me for many years.
00:35:14
Speaker
You know, after about 15, she retired and went and built, you know, did other things. But for the first 15 years was her and me. People over time, hiring that first non-accountant secretary was tough because she wouldn't bring in any money in. But that person allowed me to more and more.
00:35:38
Speaker
on productive labor, which produce revenue. So once I understood that, I can make it work. And it's been a very fun 30 years. And you talked a lot about growing a business. Now, this is going to be a little bit more business plan related, but how do you scale your business? Do you just hire more
00:36:05
Speaker
technical on your end, where they're doing things like you? Both. Technology has changed. We actually do more with less people now because of computers and email and so on. I remember when fax machines came out and they're now almost obsolete.
00:36:29
Speaker
We used them when I was dealing with an overseas importer, and we would do up our footwear designs, fax them that night, and in the morning, there'd be revisions coming back from Taiwan. That was great. That was so much better than waiting four or five days each way for DHL.
00:36:49
Speaker
So technology has changed, computers, systems, software. It's gotten better and faster and more efficient. And so that helps. And then we hire people to work with clients and solve their problems, because a lot of it's hand-holding. Oh, what do I do? How do I do this? Oh, this went wrong. Sally wants this. Joe wants that. What do I do? The check got lost. I got a letter from the IRS.
00:37:17
Speaker
you know, all these kinds of things. So we take care of that. We hire people for that. So in both aspects, technology has made us more efficient. You know, everything just makes us more efficient. We just put in a new voice phone system, which is a sweetheart. So all those things help. But you know,
00:37:37
Speaker
It basically comes down to people still have to operate the software. They have to turn on the computer. They have to make sure the stuff goes in. They have to make sure it goes out. They have to reconcile the bank account. You know, we move.
00:37:51
Speaker
several hundred million dollars a year money for our clients, for payrolls. And that's a lot of accounting now and a lot of reconciliation. So yeah, we gotta have people for that, but you know, systems are a lot better now than they were 30 years ago, I promise you. So it's a lot easier. And what necessarily made it easier? Was it because of
00:38:13
Speaker
more revenue coming into the business and you're able to, you know, pay off more and expand more, kind of elaborate on that, please. Well, obviously I'm interested to know. Sure. Cash is always king. If you don't have cash flow, you're out of business. You can take on debt, you can do a lot of things, but without cash coming in to pay the bills, you're screwed.
00:38:33
Speaker
Okay, so obviously getting bigger, getting better cash flow allowed me to buy better software and better equipment, pay myself a little better, this kind of thing.
00:38:47
Speaker
And also you have to learn it. Learning new software is always frustrating. But if it's better and it's faster, then you need to learn to do it. My staff won't let me do payrolls anymore. They do them the way I would do them because we have checklists and procedures and so on. But after this last time we changed software a few years ago, I never learned that particular operating software. So they don't let me in there to do payrolls.
00:39:14
Speaker
which is probably a good thing, but I still deal with the IRS because that's something I'm an expert at. They're not, and they don't have the credentials for it. I have both. My job has shifted internally. When we first started with payroll, I did them all. I typed them in and printed them out and patched them up and shipped them off. I haven't done that in years, but when the IRS sends a letter because the IRS made a mistake, that comes to me.
00:39:43
Speaker
You know, fun and games. I'm going to kind of nitpick here. What was the time you kind of hit that break even point? You know that time where that curve actually just hit upwards specifically?
Stability Achieved and Future Plans
00:39:57
Speaker
I would say that I was comfortable with the size of our business and the growth it was on. It took almost 20 years for us to get to the point that I said, yeah, we're going to make it.
00:40:13
Speaker
Obviously, we've been growing and paying our wage and put food on the table and clothes on my back and roofs. I had a son in service in Germany who married a German girl and settled there, so she'd go over and see the grandkids. But it was about 20 years.
00:40:36
Speaker
in business before I really said, yeah, we're there. And then I lost Ruth a few years later, which was too bad because she was really getting to the point where we could enjoy life and do some things. But it took 20 years. That's why I say work-life balance for an entrepreneur doesn't exist. What are some future plans you have for the business now? What is kind of the next stage?
00:41:06
Speaker
Well, we're continuing to grow, obviously. Well, not obviously. We're continuing to grow. We're adding new clients all the time. I'd like to continue to accelerate that. We're adding new products. We're making our product line wider and deeper. We're expanding our HR systems so we can handle
00:41:26
Speaker
more alternative situations. Timekeeping, we've added multiple clocks and including biometric clocks and so on to the mix. We've added a just from a new partner that came on recently that has a
00:41:46
Speaker
physical training aspect for employees. So we've added that to the mix. So we're adding more things to the mix to give our clients more one-stop shop for payroll and payroll related things, employee related things, 401ks, this kind of thing. We're expanding all those offerings and want to continue to do so.
00:42:10
Speaker
We're partnering with some new healthcare benefit providers to better take care of the clients. Different clients need different things and not every vendor can provide them all. We have to have various vendors that can provide things for our clients. We're trying to grow that to be able to give our clients, as I said, a one-stop shop. This was a good talk.
00:42:39
Speaker
What are some final things you have to say to anybody interested in what you do or going down your path?
Career Advice and Long-term Goals
00:42:47
Speaker
There's two things, two sayings I love and I repeat them constantly. One, there's never a traffic jam on the extra mile.
00:42:59
Speaker
you go that extra mile for your clients, your competitors won't. That puts you out in front, head and shoulders above your competition, because most of them won't do it. The second one is a saying from Bill Gates. And he said, people will overestimate what they can accomplish in a year and underestimate what they can accomplish in a decade. So stick with it.
00:43:28
Speaker
It may not happen this month, this year or next year, but you stick with it and you go for it. You'll be amazed what you can do in 10, 20 years. Good words. All right then. Thank you, sir. Jimbo, been my pleasure. Thank you for being on the show. My pleasure, sir. All right. Thank you for listening to the Jimbo Parish Show.