Jacksonville CPA | Making The Money Work
So welcome back to the podcast. It is Wednesday, May 31st and I’m gonna put this out here. I am going to start doing this podcast daily. I’m going to do it for 30 minutes, three segments of 10 minutes and hopefully that’ll provide value to you, the customer. I’m the listener, even if you’re not a client and you can come to my website and listen to these podcasts and I’m going to warn you that I’m, I’m not a professional speaker. And so sometimes I repeat myself and I may say things that are or may sound stupid, but you know, hey, give me a break. I’m learning on you. Go do podcast. So yeah, you sound well. You might sound better than me, but anyway, there it is. So well we talked in the last two segments about knowing your numbers and the importance of finding your break even point new profit, profit per customer and um, there’s so many things that I could talk about. Um, but you know, one thing, what I want to talk about right now is having a salary cap. So sorry, I need to turn that notification off. If you heard that noise, it was a notification that I just got an email. So in the NFL, every team as a salary cap, what that means is there is a cap on the salary that they can pay as a team
and they may, if they’re, they have a player that they’re paying x number of dollars, let’s just say $5,000,000 and they were up against a salary cap and they want to and they want to get a few more players for a couple million each and then they’re gonna have to waive that $5,000,000 player so they could make room for the salary cap. Now, if you’re Jacksonville CPA is not telling you this, then come over to my Neva and give us a call. So every business needs a salary cap. Okay?
So labor productivity is one of the most important numbers in your business. And this will eat you alive. People are humans. I have news for you. People are humans and humans are naturally lazy and they need to be held accountable. So if you do not have these, uh, if, if you have rose colored glasses on when it comes to dealing with your team or business, you need to take them off and realize that you’ve got a bunch of children working for you and you need to to make sure you hold themselves accountable. I’ll stop. I’m sure. Sorry. You need to make sure you hold them accountable because, you know, it’d be a bit honest here as an employee, sometimes I needed someone to hold me accountable because, um, you know, at time to, should we say my best interest at heart, I, I had my best interest at heart and not the companies, you know, we all go through days where we don’t fail. We know we get a little lazy and so we need someone to give us a kick in the pants to keep us moving on. So labor productivity is one of the most important things you can, you can measure in a business. We talked about measuring the numbers of profit per customer and so on. So labor productivity is another one of those weekly numbers that you need to track. So if you’re a Jacksonville CPA is not telling you this being proactive, you need to come by and give me a call.
They just love doing podcasts outside here. We just had a few Canadian geese fly over. It’s just beautiful here in this early morning, uh, early morning, Jacksonville, Florida. Okay. So a salary cap. So you, you know, you have a job to do, you need to set a salary cap on that job. So let’s just say you’re, you’re working on a project or let’s just say, you know, for those, those 10 customers, I’m sorry, does 19 customers that we were in that example were using earlier, finding your break even point and your, you know, the number of customers you need to achieve your financial goals, you need to find out how much labor it’s going to take to keep your, your cost
in line and have your, your revenue per unit, profit per customer reset thousand dollars. And you need to set a cap on how much you’re going to spend. So, and really first, for most businesses that are in existence, you know, you’ve got this historical data. So what you can do is you can go back and you can say, okay, you know, I’m already serving these 19 customers, but my profit per customer is not a thousand dollars, it’s $800 or $700. So then you can go back and we can, we’ll talk about some different ratios and things to make sure that the labor or the amount of salary that you’re paying is in an acceptable range as relates to the revenue that you bring again. So you can go back and you can say, okay, I’m only getting seven or $800 per customer and you can look at the, the first thing you should look at is what you’re paying in labor and making sure that, that, that number jives with some of these ratios that will go over on the next segment.
And I can tell you it’s probably not going to. Your number is not going to hit that ratio. So what you need is the habit Jacksonville CPA that is not giving this information need to come over to Mineva and let us help you with these things. So your salary cap.
And uh, I’ve worked with the customer in architectural firm here last year and her salary cap was a, well, how should I put this? She was way over her salary cap and yet, and, and she complained about not having enough money, not cashflow was bad. And I said, look, you have, we went through all of her employees and I said, you have this person, this person, this person, this person. I said, who’s not producing? And she said, Oh, well, you know, this guy is, but you know, we’re just, Oh, I keep them around because, you know, if we have a, another job, um, you know, sometimes we’ll get some work in forum. And I said, hey, listen, no, you need to fire him. He’s messing up your salary cap, you’re going to fix all your cash flow problems. You hold your daily team huddles, which, that’s another thing we can cover a daily team huddles, beautiful, magical, you know, ticket, a Jacksonville CPA firm that does these things, they’re going to get their, their, um, their work done with less people doing more work. So I was sending to fire him. She could, would not, would not fire this person yet, but she would still complain about her cashflow and her other issues. So, you know, just have your eyes wide open this, um, as it relates to the salary cap. No, no. The amount of labor that you need to spend or that you should have spent in a certain time period. And then if you’re way over that number, then you need to, you need to find a Jacksonville CPA firm that is going to help you through these numbers. So I’m going to take a pause here and we’ll be right back.