Archives for May 2024

5 Key Metrics for Boosting Manufacturing Profitability: Insights from a CPA Industry Expert

Earmark Team · May 30, 2024 ·

As a CPA serving manufacturing clients, you hold the key to unlocking hidden profitability and driving sustainable growth. By strategically managing the following five financial and operational metrics, you can help your clients navigate industry complexities and achieve long-term success.

In a recent episode of the Best Metrics podcast, Leslie Boyd, a principal at CLA’s Manufacturing Industry Group, shared her expertise on the key metrics CPAs should leverage to help their manufacturing clients thrive. With over 15 years of experience in public accounting, Leslie provides valuable insights into using these metrics to identify opportunities and guide clients toward increased profitability and growth.

EBITDA: The Cornerstone of Manufacturing Profitability

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is a critical metric that indicates profitability and cash flow health. Banks and investors rely heavily on EBITDA when assessing a company’s creditworthiness and growth potential.

“If you have a negative EBITDA, it’s probably a pretty clear indicator that you are going to struggle to generate cash flow,” Leslie warns. “And quite frankly, if you’ve got banks looking at you and you’re struggling to generate positive EBITDA, they’re going to be hesitant to lend to you.”

EBITDA also plays a vital role in business valuation and succession planning. With an estimated $140 trillion in wealth expected to change hands over the next several years due to the aging baby boomer generation, manufacturing companies must focus on maximizing their EBITDA to ensure a smooth transition and secure the best possible valuation for their business.

To help your clients improve their EBITDA, consider the following strategies:

Identify opportunities to reduce costs through operational efficiencies, such as lean manufacturing practices or automation.
Explore ways to increase revenue through product innovation, market expansion, or strategic partnerships.
Optimize pricing strategies to ensure competitively priced products while maintaining healthy profit margins.
Implement effective financial management practices, such as budgeting, forecasting, and cash flow management, to minimize financial risks and maximize profitability.

Employee Retention: The Hidden Driver of Manufacturing Success

While financial metrics like EBITDA are essential, CPAs must also recognize the critical role that employee retention plays in driving manufacturing profitability.

As Leslie Boyd explains, high turnover rates can lead to many challenges that directly impact a company’s bottom line: “If I’ve got turnover, then I’m retraining people all the time. And if I’m retraining those people, then I probably have a lot of training costs, probably have a significant amount of scrap rate as well. And it could also be indicative of the fact that I’ve got culture issues or other underlying issues going on.”

The costs associated with constantly replacing and retraining employees can quickly add up, eroding profit margins and hindering growth. Moreover, high turnover can lead to decreased productivity, increased scrap rates, and potential quality control issues, damaging a company’s reputation and competitiveness.

To help your manufacturing clients improve employee retention, consider the following strategies:

Conduct employee engagement surveys to identify areas for improvement in job satisfaction, work environment, and company culture. Use the results to develop targeted initiatives that address employees’ needs and concerns.
Encourage open communication and feedback between management and employees to foster a sense of trust and collaboration. Regularly schedule one-on-one meetings and team discussions to ensure employees feel heard and valued.
Invest in employee training and development programs to help workers acquire new skills and advance their careers within the company. Offer a mix of on-the-job training, workshops, and external courses to cater to different learning styles and needs.
Implement competitive compensation and benefits packages to attract and retain top talent. Regularly review industry benchmarks and adjust compensation to ensure your clients remain competitive in the job market.
Recognize and reward employee contributions to show appreciation and boost morale. Implement a formal recognition program that celebrates individual and team achievements and encourages managers to provide regular feedback and praise.

Inventory Turnover: Optimizing Cash Flow and Profitability

Inventory turnover is another crucial metric that CPAs should focus on when working with manufacturing clients. This ratio measures how quickly a company sells through its inventory, providing insight into its operational efficiency and cash flow management.

Leslie shares a powerful case study highlighting the impact of improving inventory turnover on a manufacturing company’s financial performance: “We had a company that really got themselves into some issues post-COVID. And many companies did. They had $50 million of inventory and we worked it down to 10 million. And you can imagine how much cash that unlocks on your balance sheet when you’re able to do that.”

This example demonstrates how optimizing inventory levels can free up significant amounts of cash, which can then be reinvested into the business or used to improve liquidity. By reducing the amount of money tied up in inventory, manufacturing companies can improve their cash flow, reduce carrying costs, and ultimately enhance their profitability.

To help your clients improve their inventory turnover, consider the following strategies:

Implement just-in-time (JIT) inventory management practices to minimize the amount of inventory on hand while ensuring that materials are available when needed. This approach involves closely coordinating with suppliers and streamlining production processes to reduce lead times and minimize waste.
Use data analytics and forecasting tools to predict demand more accurately and avoid overstocking or stock outs. Leverage historical sales data, market trends, and customer insights to develop more precise demand forecasts and optimize inventory levels accordingly.
Collaborate with suppliers to establish more flexible delivery schedules and reduce lead times. Work with key suppliers to implement vendor-managed inventory (VMI) programs or consignment stock arrangements that allow for more responsive replenishment and reduced inventory carrying costs.
Regularly review and adjust safety stock levels to balance minimizing inventory costs and maintaining adequate buffer stock. Use statistical methods to calculate optimal safety stock levels based on demand variability, lead times, and service level targets.
Implement lean manufacturing principles to streamline production processes and reduce waste. Conduct value stream mapping exercises to identify non-value-added activities and implement continuous improvement initiatives to eliminate waste and improve efficiency.

Value Added Revenue and Capacity Utilization: Unlocking Hidden Profitability

Value-added revenue and capacity utilization are often overlooked metrics that can significantly impact a manufacturing company’s profitability. As Leslie Boyd explains, value-added revenue represents the true value that a company creates through its production process, while capacity utilization measures how efficiently a company is using its available resources.

Essentially, value-added revenue focuses on the incremental value a manufacturer generates by transforming raw materials into finished goods, excluding the materials’ cost. By analyzing this metric, companies can identify opportunities to increase the profitability of their products or services by optimizing production processes, reducing waste, or finding ways to add more value for customers.

On the other hand, capacity utilization measures how much of a company’s available production capacity is used at any given time. Many manufacturers operate in a fixed-cost environment, where a significant portion of their costs remain constant regardless of production volume. By increasing capacity utilization, companies can spread their fixed costs over larger units, reducing the cost per unit and improving overall profitability.

To help your clients improve their value-added revenue and capacity utilization, consider the following strategies:

Conduct a thorough analysis of the company’s production processes to identify areas where value can be added or waste can be eliminated. Use tools like value stream mapping and process flow diagrams to visualize the current state and identify improvement opportunities.
Encourage the adoption of lean manufacturing principles to streamline operations and reduce non-value-added activities. Implement initiatives like 5S, kaizen events, and total productive maintenance (TPM) to improve efficiency, reduce downtime, and increase value-added revenue.
Help your clients understand their fixed and variable costs and how they impact profitability at different production levels. Use cost-volume-profit (CVP) analysis to determine the breakeven point and identify opportunities to optimize the cost structure.
Work with your clients to identify opportunities to increase capacity utilization, such as by accepting additional work or optimizing production schedules. Conduct a thorough analysis of capacity constraints and develop strategies to remove bottlenecks and improve throughput.
Assist your clients in developing pricing strategies that accurately reflect the value they provide to customers and ensure adequate profitability. Use value-based pricing techniques to capture the full value of the company’s products or services and avoid leaving money on the table.

Becoming a Trusted Advisor: Guiding Your Manufacturing Clients to Success

As a CPA, your role extends beyond crunching numbers and preparing financial statements. By understanding and leveraging the key metrics discussed in this episode, you can position yourself as a trusted advisor to your manufacturing clients, helping them navigate the complexities of their industry and achieve long-term success.

To become an indispensable partner to your clients, consider the following approaches:

Proactively educate your clients on the importance of metrics like EBITDA, employee retention, inventory turnover, value-added revenue, and capacity utilization. Help them understand how these metrics impact their financial performance and provide guidance on improving them.
Review your clients’ financial and operational data regularly to identify trends, opportunities, and potential challenges. Use this information to provide insights and recommendations that help your clients make informed decisions and stay ahead of the curve.
Collaborate with your clients’ management teams to develop and implement strategies that drive profitability and growth. This may involve working with other departments, such as operations, human resources, or sales, to ensure a holistic approach to business improvement.
Stay up-to-date on industry trends, best practices, and emerging technologies that can help your clients optimize their operations and gain a competitive edge. Share this knowledge with your clients and help them evaluate the potential impact of these developments on their business.
Foster open and transparent communication with your clients, regularly checking in to discuss their goals, challenges, and concerns. By building strong relationships based on trust and mutual understanding, you can become a valuable resource that your clients rely on for guidance and support.

To Learn More, Listen & Subscribe to “Best Metrics”

To learn more about how you can help your manufacturing clients unlock hidden profitability and drive sustainable growth, listen to the full podcast episode of Best Metrics featuring Leslie Boyd. With her wealth of experience and practical advice, Leslie provides a roadmap for CPAs looking to take their manufacturing advisory services to the next level.

How an SEC Internship Led to a Thriving Career In Forensic Accounting

Blake Oliver · May 29, 2024 ·

Think working at the Big Four is the only way to make it big in accounting? Think again. Cody Turley’s story might just change your perspective.

On a bonus episode of The Accounting Podcast, Cody Turley, a CPA and CFE currently working at the SEC, challenges the notion that Big Four experience is the only route to success in accounting. He shares his experience to demonstrate that working at top organizations in industry or government can provide equally valuable experience and open doors.

The Power of Non-Traditional Accounting Internships

Cody’s path began with an unconventional internship at the SEC. And it wasn’t that difficult to get.

“So I really liked the show Suits,” Cody recalls. “And at one point they get in trouble with the SEC. And that just kind of peaked my mind about forensics. I should go and look at what that is. And I just applied online, and I got a call back and that’s it. That’s how I got that internship.”

Cody’s internship at the SEC exposed him to high-level tasks and responsibilities, such as reviewing complaints against companies of all sizes. The SEC’s name recognition also helped open doors for Cody in his subsequent career, even years after the internship.

A Government Job Doesn’t Mean Slow Advancement

After the SEC internship, Cody landed a job at the Arizona Corporation Commission. In his mid-20s, he was leading a forensic accounting team. “A year of experience, and I’m testifying, which just doesn’t happen at [public accounting] firms,” he shares.

Leading a team of more experienced employees was challenging but rewarding for Cody, as it provided opportunities to learn from their experience while guiding the team. His age did not hinder his ability to lead effectively, demonstrating that leadership skills and expertise can be developed early in one’s career, even in a government role.

Navigating the Complexities of Government Roles

Cody then returned to the SEC. His current role involves investigating offering frauds such as Ponzi schemes, tracing assets, and reviewing audited financial statements to identify errors. He collaborates with auditors and companies to investigate potential issues, often through subpoenas and interviews.

One of the challenges Cody faces in his role is interacting with large accounting firms. However, he emphasizes the importance of focusing on the learning process and gathering information rather than trying to be “better” than the firms in every instance.

How to Land a Government Accounting Role

For accounting professionals interested in exploring government roles, Cody offers some practical advice based on his own experience.

He suggests applying online, as hiring tends to be more merit-based than the private sector. This levels the playing field for candidates who may not have extensive industry connections but possess the necessary qualifications and skills.

Cody also highlights the benefits of working in smaller teams within government agencies. These teams can allow for rapid skill development and increased responsibility compared to private accounting firms’ more structured and hierarchical environments.

A World of Possibilities: Future Career Options

Cody’s government background has created many potential future paths, including moving up in government, transitioning to state-level roles, or pursuing opportunities like internal audit at major corporations. His skills are highly transferable and sought-after.

“The biggest company I’ve received an offer from was Disney at one point to be on one of their internal investigation teams,” Cody reveals. This highlights the value that the private sector places on the skills and experiences gained through government accounting roles. His background in investigating financial crimes and navigating complex regulatory environments has equipped him with a unique skill set that is highly sought after by businesses looking to strengthen their internal audit and compliance functions.

The Bottom Line: Finding Your Own Fulfilling Path

Cody’s experience shows that there is no one-size-fits-all approach to building a successful and fulfilling career in accounting. While the Big Four path may be the right choice for some accounting majors, future CPAs need to explore the full range of options available and find the path that aligns with their unique interests, skills, and goals.

Whether it’s pursuing government roles, seeking out industry positions at top companies, or exploring specialized fields like forensic accounting, there are countless ways to build a rewarding career in this dynamic field. The key is to remain open to new opportunities, seek diverse experiences, and never stop learning and growing.

So, if you’re ready to take control of your accounting career and explore the exciting possibilities that await you, listen to the full podcast episode featuring Cody Turley. His insights and experiences are sure to inspire you and provide valuable guidance as you navigate your professional journey.

The Psychology of Fraud: Why Even Experts Fall Victim to Deception

Earmark Team · May 29, 2024 ·

In the early 2000s, Bernie Madoff’s multi-billion-dollar Ponzi scheme came crashing down, revealing a shocking truth: even seasoned financial experts and savvy investors had fallen victim to his deception. Despite their years of training and experience in detecting fraud, these professionals had been duped by Madoff’s charming demeanor and the allure of steady returns.

This raises the question: if even the most skilled among us can be fooled, what chance do the rest of us have against the psychological tactics employed by fraudsters?

In this thought-provoking episode of “Oh My Fraud,” hosts Caleb Newquist and Greg Kyte delve into the complex world of fraud detection and prevention with guests Dan Simons and Chris Chabris.

Join us as we explore how fraudsters capitalize on human psychology to deceive their targets, why even highly trained professionals struggle to detect and prevent fraud effectively, and what can be done to enhance critical thinking training and mitigate the impact of inherent biases on decision-making.

What Fraudsters Understand About Human Psychology

To understand the challenges in detecting and preventing fraud, it’s crucial to recognize the psychological tactics fraudsters employ. One of the key vulnerabilities they exploit is people’s tendency to focus solely on the information presented to them without seeking additional relevant details.

As Chris Chabris points out, “[Fraudsters] know that when people focus on one thing and process the information that’s in front of them or that’s been put before them, they’re very unlikely, or at least less likely to go and look elsewhere for other kinds of relevant information. People will often make a decision based just on what’s in front of them, even when other information they don’t have could be just as important or more important to making the decision.”

By capitalizing on this cognitive bias, fraudsters can lead individuals to make decisions based on incomplete information, making them more susceptible to fraud. They craft compelling narratives and present information in a way that draws people in while skillfully omitting details that might raise suspicion.

This tactic is particularly effective because it takes advantage of our natural inclination to trust the information we’re presented with, especially from a seemingly credible source. As a result, even those who consider themselves savvy and skeptical can fall victim to fraud if they don’t actively seek out additional information and question the narrative they’re being sold.

Overconfidence and the Illusion of Being a Good “Bullshit Detector”

Another psychological vulnerability that fraudsters exploit is overconfidence in one’s ability to detect deception. Paradoxically, this overconfidence can make individuals more vulnerable to fraud.

Dan Simons illustrates this point with an example from the world of magic: “Magicians are very good at giving people a false story. They give you a narrative, they make you think, here’s what I’m doing when they’re actually doing something totally different. So all they have to do to fool somebody who’s a good critical thinker is give them a possible explanation for the magic effect that’s wrong. And if they think they’ve discovered it themselves, they lock on to it.”

Like magicians, fraudsters can exploit overconfidence by providing false explanations that appeal to a person’s sense of having “figured it out.” When people believe they’ve uncovered the truth, they often overlook other potential explanations or red flags.

This psychological vulnerability can affect even the most critically minded individuals. When we’re overconfident in our ability to detect deception, we may let our guard down and become less likely to question our assumptions or seek out additional information.

As a result, those who pride themselves on being good “bullshit detectors” may be more susceptible to fraud in certain situations. By believing they’ve outsmarted the fraudster, they can fall right into the trap set for them, failing to recognize the deception until it’s too late.

Professional Skepticism in Accounting and Its Limitations

One might expect that professionals in fields like accounting, auditing, and journalism, trained in critical thinking and skepticism, would be better equipped to detect and prevent fraud. However, the reality is that even these professionals face significant challenges in combating fraud effectively.

Dan Simons states, ” Auditors, journalists and scientists are all supposed to be trained in critical thinking. They all get some training in critical thinking and how to ask questions and when to dig further. But they’re all subject to the same sorts of biases that we have.”

These biases can cloud judgment and make it difficult to detect fraud, even when one is actively looking for it. Some of the biases that can affect professionals include:

Confirmation bias: The tendency to seek information that confirms one’s beliefs and ignore evidence that contradicts them.
Anchoring bias: The tendency to rely too heavily on the first piece of information encountered when making a decision.
Availability bias: The tendency to overestimate the likelihood of events that are easily remembered or readily available in one’s mind.

To combat fraud effectively, professionals must be aware of these biases and actively work to mitigate their impact on decision-making. This may involve implementing additional strategies and procedures, such as:

Seeking out dissenting opinions and alternative explanations
Conducting thorough due diligence and fact-checking
Using checklists and other tools to ensure a systematic approach to fraud detection
Engaging in ongoing training and education to stay up-to-date on the latest fraud schemes and detection methods

By recognizing the limitations of professional skepticism and taking proactive steps to address them, professionals in accounting, auditing, and related fields can improve their ability to detect and prevent fraud. However, it’s an ongoing challenge that requires constant vigilance and a willingness to question one’s assumptions and biases.

The Bottom Line: Staying Vigilant in the Face of Fraud

As fraud schemes become increasingly sophisticated, accounting and auditing professionals must stay vigilant and adapt their strategies accordingly. This may involve incorporating insights from psychology and behavioral science into professional training programs and fostering a culture of healthy skepticism and critical thinking within organizations.

Detecting and preventing fraud is a shared responsibility that requires ongoing collaboration and communication between professionals, regulatory bodies, and the wider public. We can create a more resilient and fraud-resistant society by working together and staying informed.

To learn more about the fascinating world of fraud and the psychological battleground it creates, be sure to listen to this captivating episode of “Oh My Fraud.”

Intuit’s Tightrope Act: Balancing Innovation and Accountant Needs in a Shifting Landscape

Earmark Team · May 29, 2024 ·

Intuit has emerged as a leader in the evolving accounting software landscape, continuously pushing the boundaries of innovation and ecosystem development. However, as the company strives to stay ahead of the curve, it must also navigate the delicate balance between introducing new features and addressing the specific needs of its accountant user base.

In a recent Unofficial QuickBooks Accountants podcast episode, Hector Garcia, CPA and Founder of Right Tool for QuickBooks, and Alicia Katz Pollock, CEO and Founder of Royal Wise Solutions, delve into the challenges and opportunities Intuit faces as it seeks to maintain this balance.

Intuit’s Successes

Hector and Alicia offer unique perspectives on Intuit’s successes and challenges.

Hector commends the company’s exceptional educational content for accountants, noting that “it’s above and beyond the call of duty. They get that absolutely right.” He also praises Intuit’s ability to gather and listen to feedback, describing the company as “a feedback gathering machine.” Furthermore, Hector highlights the ease with which developers can integrate with Intuit’s platform, citing it as the “easiest one to work with” among many companies.

On the other hand, Alicia emphasizes Intuit’s ability to foster a strong sense of community among its users, creating a passionate and dedicated user base that actively engages in helping one another. She stresses the importance of embracing change in the accounting industry.

A Challenging Transition to QuickBooks Online

A key challenge discussed is transitioning from QuickBooks Desktop to QuickBooks Online.

Hector says, “Moving to a single platform on the cloud is the right decision. The current state of things is rocky. We don’t have all the features we want. Desktop has more than online. There’s tons of glitches.” While rocky, Hector believes moving to a single cloud-based platform is the right decision for QuickBooks’s future.

To successfully navigate this transition, accountants must:

Embrace change and adapt to new workflows.
Leverage Intuit’s educational resources and training programs to build expertise.
Communicate openly with clients about the benefits and challenges of the transition.
Collaborate with peers to share best practices and troubleshoot issues.

Leveraging Third-Party Apps and Integrations

Effectively leveraging third-party apps and integrations is critical to thriving in the QuickBooks ecosystem. Hector emphasizes the ease with which developers can create integrations with QuickBooks Online: “The ecosystem of apps that integrate with QuickBooks is huge. The amount of options that you have in terms of using some other app to talk to QuickBooks is huge.”

To make the most of these opportunities, accountants should:

Explore the QuickBooks App Store and familiarize yourself with the available integrations.
Identify apps that streamline workflows, automate tasks, and enhance client services.
Invest time in learning and implementing relevant apps to improve efficiency and value.
Educate clients on the benefits of using integrated apps to manage their finances more effectively.

The Road Ahead: Balancing Innovation and User Needs

As Intuit continues to balance innovation and ecosystem development with the needs of its accountant user base, it must remain committed to open communication, transparency, and adapting to its users’ evolving needs.

By leveraging its strengths in areas like educational resources, user-friendly onboarding, and third-party app integrations, Intuit has demonstrated its commitment to empowering accounting professionals. However, more work remains in effectively prioritizing and addressing accountants’ needs as Intuit gathers feedback, integrates new products, and navigates the cloud transition.

For accountants, embracing change, adopting a positive mindset, and thriving in the face of evolving technologies and business practices will be key. As Alicia notes, “You just can’t be afraid of change. You have to embrace it.”

To dive deeper into the insights shared by Hector and Alicia and to learn more about how you can navigate the evolving landscape of accounting software, be sure to listen to the Unofficial QuickBooks Accountants podcast.

Alicia Katz Pollock’s Royalwise OWLS (On-Demand Web-based Learning Solutions) is the industry’s premier portal for top-notch QuickBooks Online training with CPE for accounting firms, bookkeepers, and small business owners. Visit Royalwise OWLS, where learning QBO is a HOOT!

The Two Metrics That Can Double Your Accounting Firm’s Value in One Year, According to a Top Broker

Blake Oliver · May 29, 2024 ·

What if you could double your accounting firm’s value in a single year? Brannon Poe, a broker who’s handled over 500 firm sales, says it’s possible with the right strategic changes.

In a recent podcast interview, Poe revealed that firms of any size can transform to maximize value and position themselves as attractive acquisitions by understanding what buyers want. The secret, he says, lies in mastering two key metrics.

We’ll unpack Poe’s road-tested insights on the levers of firm value and see how one traditional practice achieved a staggering valuation increase with clever strategic shifts. Whether you aim to sell soon or build a more valuable business, Poe’s wisdom will show you the way.

The Two Metrics That Move the Valuation Needle

Want to supercharge your accounting firm’s value? Brannon Poe says zeroing in on two key metrics can have an outsized impact.

1. Cash Flow to Owner

“I always tell people, I’ve got two metrics. If you focus on these two metrics alone, you will increase the value of your firm,” Poe explains. “Cash flow to owner is probably number one.”

Your bullseye? For firms under $1.5 million in revenue, pushing cash flow to 50% or more of revenue. To calculate it, add your profit, owner compensation, and owner perks. For example, if your firm earns $1 million in revenue and your cash flow is $500,000, you’re right on target. The higher your cash flow margin, the more attractive your firm looks to buyers.

2. Owner Hours

“Owner hours is the other thing,” says Poe. “If you want the owner hours to be lower, lower is better – at least under 2000. But I have seen very well-systematized virtual firms get into the 500 mark for an owner. So you’re creating a real business at that point.”

Minimizing owner hours reduces key-person risk and makes your firm more transferable. Buyers hesitate to acquire firms dependent on grueling owner hours, but a firm that runs smoothly with minimal owner involvement garners premium offers.

Poe notes that adopting subscription pricing can drive progress on both fronts. Steady, recurring revenue and systematized work help boost margins while trimming owner hours.

By lasering in on lifting cash flow and reducing owner involvement, firms of any size can transform into highly valuable, transferable assets. Next, we’ll see how one traditional firm put these principles into action to stunning effect.

From Surviving to Thriving: A Case Study in Strategic Transformation

The story of one husband-wife firm perfectly illustrates how powerful Brannon Poe’s value-boosting principles can be – even for small, traditional practices.

Starting Point: A Traditional Firm in Need of Change

When the owners first approached Poe, they ran a classic mom-and-pop shop generating $1.2 million in annual revenue. Feeling overworked, underpaid, and unsure if they could keep going, they turned to Poe for help.

The Transformation Game Plan

Working with Poe, the owners implemented three key changes:

Fired unprofitable clients: To free up much-needed capacity, the firm shed about 100 clients that drained time and resources but delivered minimal profits.
Raised prices: As Poe puts it, “If you don’t like your practice, keep increasing the prices until you like your practice.”
Embraced subscription pricing: Transitioning clients, especially bookkeeping customers, to a recurring subscription model provided a steady, profitable revenue base.
Launched advisory services: The firm created packaged advisory offerings and bundled them into subscription plans, enabling premium pricing.

Stunning Results in Just One Year

The transformation was dramatic and swift. In just 12 months, the firm:

Increased annual revenue to $1.6-1.7 million
Expanded margins as new recurring revenue flowed to the bottom line
Reduced owner hours while increasing employee pay
Landed an all-cash deal at their full $2 million asking price

The Power of Strategic Transformation

This firm’s journey embodies the incredible potential of Poe’s approach. By lasering in on profitability, recurring revenue, and owner efficiency, they morphed from a floundering traditional practice into a high-value strategic asset – in just one year.

The Roadmap to a Firm That Works for You

This story powerfully illustrates that transforming your firm doesn’t have to take decades. With relentless focus on the right drivers, even tiny traditional practices can utterly rewrite their futures in under a year.

The key is strategically designing your transformation around buyers’ wants: powerhouse profitability with minimized owner dependence. Adopting the recurring revenue model, shedding margin-draining clients, and productizing premium advisory services are shortcuts for getting there faster.

Poe envisions a future where firm owners don’t have to choose between a profitable practice and a livable life. By architecting businesses that thrive without their constant oversight, owners can boost their bottom lines, free their schedules, and create thriving firms that are valuable today – and sellable tomorrow.

If you’re ready to build a practice that funds your ideal lifestyle now while setting you up for a profitable exit whenever you’re ready, the roadmap is clear – and it starts with learning everything you can from the best in the business. Take the first step now by listening to the full interview with Brannon Poe.