OPINION: Many years ago I discovered a simple business success strategy.
Talk to successful business people and ask them two things: What did they do to build their successful business and how did they handle the many challenges along the way?
Whenever I do this I’m amazed at the terrific ideas I get and that’s the purpose of this new series, Real Life Business Lessons.
I’ll be interviewing a wide range of successful business people around the country and finding out what worked well for them and how they solved big problems along the way, with the goal of uncovering some helpful ideas that you can use in your own business.
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A few days ago I was chatting with Jamie Tulloch the managing director of E3 Business Accountants, a very successful accounting firm with a team of 15 including 11 full-time accountants.
Jamie bought the accounting firm on his 50th birthday, 23 years ago (It was a lot smaller then and had a different name).
The interesting thing about Jamie is that he is not an accountant himself. He is, however, a very good business person.
Before the purchase, Jamie had been self-employed for some 25 years. He had owned numerous businesses, either solely or with others and these ranged from manufacturing, retailing and exporting.
Jamie quickly realised that sales and marketing is the engine room of any business. Nothing happens until a product is sold or a service is contracted and with very few exceptions, the best product, the best service or the most original idea and IP has no value if it can’t be sold to an independent and critical buyer.
Jamie and his team did something very simple to grow E3 Business Accountants. They surveyed business owners and asked what they most disliked about their accountants and what would the ideal accountant do for their business. Based on the feedback from their survey, it became clear that accountants too often made promises they couldn’t keep about fees and delivery dates.
So, at E3 Business Accountants they initiated a process to scope and quote all work up front with a fixed fee and then guaranteed a delivery date. This minimised disputes over fees and eliminated impatient business owners waiting for their accounts to be completed.
The biggest challenge initially for Jamie and his team was developing a process that enabled them to fully scope a job before they started it and then to figure out exactly when that job would be completed and ready for their client.
Jamie discovered that traditionally accountants have many jobs open at any one time and the client who telephones or emails the most, gets their job moved up the queue. This is good for the impatient client, but then pushes all other clients further down the queue. The accountant then must create stories for clients why their work is still waiting to be finished. By eliminating this problem of not knowing when your accounts would be ready plus not knowing how much they would cost, Jamie’s business grew rapidly.
One of the other big things that Jamie does at E3 Business Accountants is provide helpful ideas and resources to help business owners to grow their business and make them more successful.
Jamie is continually providing useful videos, seminars, newsletters and other resources that will help businesses to improve their results and Jamie will often tailor these resources when major events have a huge impact on his clients.
A good example was when a major earthquake struck Christchurch in February 2011 and caused massive damage in the region. E3 Business Accountants are based in Christchurch and because of the earthquake many businesses were forced to close and other suffered huge financial losses.
Jamie knew that if he did nothing his accounting practice would suffer, so he began looking for new ways to be of help to his clients.
Jamie realised that many of his clients would need help making insurance claims to their insurance companies, so he hired insurance claim experts and was then able to offered expert advice so his clients could put in accurate and timely business insurance claims. This was useful for his clients and created a brand-new source of revenue for his firm.
Jamie also saw that thousands of trades people where going to be needed for many years to help rebuild Christchurch and many of these people would be moving to Christchurch from other parts of the country, so he began running free seminar for trades people showing them how they take maximum advantage of the huge amount of new work that would be around for trades people.
The Detail: From lockdown to recovery – tracking a small business during Covid-19 pandemic. (First published June 30, 2020)
Many of these tradespeople found Jamie’s ideas useful and decided to use his accounting services. So Jamie gained dozens of new clients. The end result was that by looking for new ways to be of help to his clients in the face of a major problem, Jamie’s business did very well and is going even better today.
Fast-forward to 2020 and Jamie and E3 Business Accountants are still using the same strategy of providing helpful resources to their clients that are relevant to what is happening in the world right now.
The big challenge for many business people has been the massive disruption and changes caused by Covid-19 and that’s why Jamie recently set up The Brainstorm Room – New Zealand’s most comprehensive free help and advice website for small, medium and family owned businesses.
Here’s a tiny part of what you get when you join The Brainstorm Room:
- Webinars – free and unlimited access to live and recorded hard hitting Covid-19 recovery and growth focussed webinars
- Q&A forums – where the Brainstormers answer your business challenges
- Resource toolbox – unlimited access to lots of useful tolls
- Personalised email responses – tell us your issues and challenges and get a helpful and insightful response
- 90-second wisdom videos – quick, fast and thoughtful ideas for your business
All at no cost.
Jamie told me that the Covid-10 lockdown was the genesis of The Brainstorm Room. Business owners very quickly adapted to Skype, Zoom and participating in webinars so Jamie and his team figured that if they gathered together professionals, entrepreneurs and business experts from their own network, they could create a website that was the portal into all this expertise.
All the Brainstormers have volunteered their services and business owners from anywhere in New Zealand can join for free and get access to this powerful team (I’ve joined The Brainstorm Group myself as I think it’s an excellent resource for any business owner in New Zealand who wants to improve their results).
I asked Jamie what were some key messages that he would like to give to business owners today who are facing big challenges in many areas.
The first message Jamie told me he would like to share with business owners is to remove the word ‘passion’ from your business plans, from your narrative, from your mind. Passion kills logical, pragmatic thinking. Passion can pump up the heart and convince you that your idea is invincible and then you hit the deck because your passionate idea has no buyers. Beware of committing a crime of financial passion.
Jamie told me: “I love passionate people and I admire passionate entrepreneurs who create employment by taking risks and putting everything they own on the line. But please use your passion to drive your head. It’s very difficult to be self-objective so seek out the advice and guidance from crusty old successful business people as long as they know and understand modern day business”.
Jamie gave me a good example of the value of using critical thinking in your business. Businesses that produce products or services that have a labour content, often wonder why they make less profit than anticipated on their labour.
A typical statement from an employer might be: “I pay Sean $25 per hour but charge him out at $50 an hour, so I know I should make a decent profit on his labour. How come I make far less than I should?”
Jamie explains that the real cost of labour is actually much higher than it seems, so E3 Business Accountants developed an online calculator to help employers know their break-even point, and then they can add a margin on top to get to a profitable charge-out rate.
As an example, the calculator reveals that when all employee costs are taken into account and your employee is say 80 per cent productive (which is quite high in real terms) then to make a 20 per cent margin on labour, the charge out rate needs to be $51.05 based on a paid hourly rate of $25 (and this is only the gross margin on labour before all your business expenses and overheads are added in!)
Another example, if your employee is only 75 per cent productive (meaning 75 per cent of their paid time at work is billed to customers) then the charge out rate jumps to $80:84 per hour!
Jamie told me that he is happy to make this online calculator free to use to all Prosper readers. All they need to do is email Jamie.
The second message that Jamie wants to share with all business owners is this one. Don’t overlook your mental health. Business ownership is highly stressful. One of the very best ways for handle stress and pressure is to get physically fit and strong. As Jamie said “Your mind and body is your business’s fuel cell. Keep it well watered, well-fed and fully charged.
No business can succeed with an owner in ill health. Treasure your body. Treasure your health. Nurture yourself then go build your business.
Jamie is a terrific example of a strong body and a strong mind going hand in hand. Jamie has been practising martial arts for over 30 years; he’s done the gruelling Coast-to-Coast event three times and is a very accomplished cyclist.
Jamie is in his 70s now and still pushes himself mentally and physically every day and his business is thriving as a result.
I really like what Jamie has done with his accounting practice. He found the things that people didn’t like about accountants, and he eliminated these concerns with his own clients and quickly grew his business as a result.
He’s also continually provided valuable resources to help his clients improve their results and makes these resources highly relevant to today’s events and circumstances.
He’s also one of the few business experts I’ve come across who says you have to have a strong mind and a strong body to do well in business and that you need to challenge your mind and body regularly to get the best out of your business.
I also love his comments about using critical thinking when making your business plans and not relying solely on passion and enthusiasm to get you through.
A great example of critical thinking is knowing exactly what your real profits are if you are charging out labour to your clients.
Which ideas from Jamie can you use in your own business?
Graham McGregor is a marketing adviser. You can get his free 129-page marketing guide, ‘The Plan B Sales Solution,’ here.