Mike Michalowicz: 0:00

I thought physical safety was something we had to worry about in the 1800s. This is how ignorant I am. I asked my office here. I said is there any safety concerns? It was an anonymous survey. And they came back and said, yeah, the alleyway on the side of our office there's an alleyway that goes to the parking lot. They said it's pitch black and when the sun starts setting you know this time of year by five o'clock, four o'clock, it's getting dark. We're leaving, I, we're leaving. I'm afraid about leaving the office and going down this dark alleyway and I start thinking about it around noon. So half the day is wasted in worry. I'm like, oh my God. So we put string lights up and it's super bright and you can see exactly what's going on because you all the way to your car and it's brought around this level of safety. So we have to evaluate these things.

Tina Smith: 0:42

Welcome to the Natural Products Marketer Podcast.

Amanda Ballard: 0:45

I'm Tina and I'm Amanda, and we're here to make marketing easier for natural products businesses, so you can reach more people and change more lives.

Tina Smith: 0:57

Welcome to another episode of Natural Products Marketer Podcast, and today we are joined by one of my favorite people, mike Michalowicz. He is a business writer, author, speaker, and he owns I don't know 15 different businesses. I'm very excited to have him today because he I love what Mike has to share, because he always talks about things that he has stumbled through and sort of figured out. And what he does is he has an amazing network of connections that he goes to when he's having a problem and he's like how do I solve this? And then he's a researcher too that looks to find all the ways that you can fix the problem that he's having. So I I'm just so excited to have him on the podcast. He's a great business resource and a personal friend.

Amanda Ballard: 1:52

Yeah, and I will say I remember Tina introduced me to Mike's work years ago and I had never heard of him before and immediately I became a fangirl and read about every single book that he's ever written in a very short amount of time. And immediately I became a fangirl and read about every single book that he's ever written in a very short amount of time and I was like I see why you like this guy so much, because he is definitely a wealth of knowledge, a super easy read, super fun and practical. I personally love listening to his books on Audible because he's so animated and it's just so much fun. So I hope you enjoy this interview with Mike Michalowicz.

Tina Smith: 2:27

We are excited to have you here.

Mike Michalowicz: 2:30

I can feel it. I can feel the energy.

Tina Smith: 2:35

I feel like you're being sarcastic, but we're excited.

Mike Michalowicz: 2:38

There's a little bit of sarcasm in there. Good Well, I'm excited to be with you. Let's have some fun and be of service.

Tina Smith: 2:44

Yes, let's do have some fun. We want to first talk to you about your book. All In, this is Mike Michalowicz, and he's my friend and an author. And Mike, we've known each other for how many years now Five, six years.

Mike Michalowicz: 3:05

Um, yeah, something like that it's been. Yeah, I would say over five under seven. So there you go.

Tina Smith: 3:11

Right, yeah, and I first came to know who you were through profit first. You did a podcast on Donald Miller's podcast for story brand and that's how I got to know who you were and I connected with one of your Profit First people and she then connected us because she was doing great and it's Dr Sabrina Starling who is wonderful.

Tina Smith: 3:36

She's an amazing business coach and she brought us together for a business retreat. That's where we first met, so that was exciting. But now you've written a new book called All In, and it's about getting your employees to be all in on your business.

Mike Michalowicz: 3:54

It is. It's also the smallest book. I don't know if you can see it, but see, it's about that big. So think about that. Trying to read that. The text is like and and the reason I did this, tina and Amanda, I know cause you're asking me why would the person make a book that's the size of a thimble? And the reason is I asked Don Miller. I said how do you get people more engaged? He's like make it so difficult that they have to be fully attentive. And so I'm gonna make the smallest book ever. And sure enough, uh, no one's read it.

Tina Smith: 4:25

And now it's blending into your background.

Mike Michalowicz: 4:27

You've got to choose that background color. It's actually sitting on my shoulder there, yeah, so the book's called All In the subtitle is how Great Leaders Build Unstoppable Teams, and what I did and, admittedly, what I do with most actually all my books is there is something that I'm not good at that I'm struggling with that. I want to learn how to get better at it, and I think I've been a meh leader in many capacities and I really want to up-level my game, and I found techniques and strategies that most people don't consider, and it doesn't matter if you're in the marketing industry or if you're in bowling lanes or bowling alleys, it doesn't matter. Leadership needs to be present. So I discovered these different techniques. I've been trying them out and I would think I went from meh to meh plus now to meh plus now, but I think there's ways to elevate your game, to really be a leader that doesn't lead through authority in the traditional sense, leads through compassion. That actually is the ultimate expression of authority.

Tina Smith: 5:37

Can you tell me what scale you're rating that on from meh to?

Mike Michalowicz: 5:42

Yeah. So you want to know the whole scale. So the lowest is pfft, the highest is like my god. So somewhere between pfft and my god is there's meh. There's meh plus, there's like that's pretty good. There's like meh, I haven't seen much better. Then there's I've seen better, but not many. And then there's me've seen better, but not many. And then there's ah.

Tina Smith: 6:06

So hopefully that helped. Meh plus, meh plus For context.

Mike Michalowicz: 6:10

Yeah, the book can get you to. Oh my God, I really do feel that way, but you got to execute on it and it takes time.

Tina Smith: 6:18

Right, okay, so we are actually talking to independent retailers. This is what our podcast is all about. Natural products retailers. This is what our podcast is all about Natural products retailers. And then the independent guys, the mom and pops. They probably have one location, sometimes they have two, maybe a few more, but it's consolidated to a geographic location and they are sometimes competing with the publics down the store that's got to buy one, get one with similar products. So they're also competing for talent and it's interesting, especially right now, that's harder than ever to get good people in a retail setting who want to come into a location and be part of the community and do what you want to do. So this could not be more timely, I think.

Mike Michalowicz: 7:07

I agree. I'll tell you what we've been told to do is well for your retail store selling these natural products. What's the grand mission? How are you serving the community? What's the goal? That's the wrong move. And yet we've all been told that, because that's going to empower my team to rally around this one point, there's partial truths to it. Here's the question I found is, as you consider people, what is their individual visions for themselves? What do they want to do? What's meaningful to them? So the grand mistake that leaders make, and I've made for 20 years, was saying here's the corporate mission. We're going to eradicate entrepreneurial poverty. That's important to me or we're going to I used to be in computer crime investigation we're going to make sure that we deliver the essence of the truth, which is the data itself. But when I spoke to my colleagues, while that was great and all one person their dream was to surf and navigate the world by sailboat. Her name is Carol. She's like that's what I'm here for.

Mike Michalowicz: 8:12

This is great but I also want to achieve this and this is the most important thing in my life. Everyone has their vision and what a great leader will do is understand the vision of every individual and that we do have individual visions. And then how do we lock arms? How do we achieve this great vision of bringing health to our community and someone having a travel experience or whatever it may be, and the other person achieving what they want?

Mike Michalowicz: 8:39

Now, I'm not saying this is Make-A-Wish Foundation. I'm not saying our companies need to satisfy these dreams, but we need to see this is what's most relevant to our colleagues and employees, just like the corporate mission is inevitably the most important thing to the owner Eradicating entrepreneurial poverty. That's my mission. That serves my ego. I'm excited about that, my colleagues get it and they want to support that. But they have other facets of their lives that's extremely important to them. They recognize what I want and therefore they're on board. I recognize what they want and therefore I'm on board with them, and it's simply just having the conversation about it. Sometimes there's blocking and tackling. Sometimes I can make an introduction or vice versa and help out, but when we show that we care for the mission of each team member. Each team member cares for the mission of the corporation, which is the mission of another team member, which is the owner.

Tina Smith: 9:35

Yeah, let me give you a realistic example of how this happens in the stores. A lot of these people want to help people on their health and wellness journey, and the owner might be male and very excited about sports nutrition, while we hear stories all the time like, how do you get into this industry, how do you get into this business? And they hire someone who is just trying to take care of a major illness in their kid's life, who is just trying to take care of a major illness in their kid's life and that can open up huge doors for being able to bring products that can help other children or help other moms support their kids on while they're dealing with major illnesses and different ways to affect that. We've seen that happen again and again.

Mike Michalowicz: 10:23

Yeah, and the more we have the opportunity to speak about our own individual stories and desires, the more connection forms. So I'll tell you a little thing we do here at our office. We have a daily huddle happen this morning, 931. That's our start time and the traditional business huddle is here's our mission for the company, here's our individual tasks. That is important. We do need to be in alignment, we have to work in concert. But the thing that we add is we talk about how you're doing on your own individual missions. So I have it. It's off camera, but let's see if I can turn my camera this way just so you can see it right. There is a poster. It says mike 2024.

Mike Michalowicz: 11:04

Um, one of the missions was introduce introduce Tina to someone for her. To date that seemed to work out pretty well. But on there I have different individual personal desires. I have in all different categories. Well, my colleagues, we all have these and we refer to them every meeting. It's like, hey, do you check anything off your list?

Mike Michalowicz: 11:26

So we we have that personal conversation, but we're all aware of what's going on. There's something special when the owner of that retail store and there's maybe two or three other people working there, whatever it may be, comes in the morning and says, doesn't say, hey, let's have a great day, let's sell some vitamins. Comes in and hey, how did last night go? Did you have that conversation with the mortgage broker? Is the house getting a little closer? Hey, how's your mom doing? I know she's not doing well and that she's such an important facet of your life. Those conversations build connection and that's what's missing out. So we have a deliberate practice happens to be every morning where those conversations come up. We have a deliberate practice, happens to be every morning where those conversations come up no-transcript.

Amanda Ballard: 12:13

Yeah, I absolutely love that because I've worked in corporate America and you know Fortune 500 companies.

Mike Michalowicz: 12:19

Sorry to hear that.

Amanda Ballard: 12:21

I know I hated it because that did not exist and it was like you're just a cog in a wheel and it was like you know, maybe I would talk to my manager once a week and it was just like hey, Amanda, what's up Like that was, that was the extent of our personal connection. And then when I started working in small mom and pop businesses, it was like, hey, how are your kids? You're heard of children, Let me, let me tell you all the crazy stuff that's going on at home and, uh, I have four, by the way, Um, uh. So that was a huge, just shift for me personally, where I was like this is what work can be and something that I feel like the independent retailers that we work with need to lean into even more is like this is a strength. Maybe you can't pay the salaries that this Fortune 500 company was paying me, but, my gosh, you connect with me on a personal level and how important that is. Like I would gladly work for a company for less money if I felt like I was valued.

Mike Michalowicz: 13:28

Yeah, corporate America seems to dehumanize. This is a generalization. Not all corporations do this, but there's a tendency. And what facilitates that is we have terms like human resource. A human resource, you're a thing, not a human being. They have to pay higher salaries because they dehumanize us. So the only way to attract someone is the currency tradeoff. Interestingly, you can't pay enough to someone to feel human. You have to be human, and so, as corporations stay a little longer, we're going to golden handcuff you and, oh, your human part. You can have that when you leave the office.

Mike Michalowicz: 14:09

So one advantage that small business has is we're so much more intimately connected. I think part of the reason is just the nature of it is we have so many job responsibilities. There's such a stronger dependency. So think I have a retail store with four employees, including myself. If Mandy and Tina, you both work for me and man, if you say I have to be with the herd of kids today, that's 25% of the work staff gone for the day.

Mike Michalowicz: 14:39

Now, to give context, corporate America with 100,000 employees. If one person says I got to go take care of the kids, whatever, we have 100,000 employees, but if 25%, if 25,000 people said can't show up today, that'd be all over the headlines of the news 25,000 people don't show for work. But that's what's happening to small business. It's just because we're playing small numbers, we don't think the impact is a big deal, but it is a massive deal. So there's a dependency and a need for the owner to have these employees available and to play all out. And because we're small, we have this intimacy. So I really want to know about you, because I really depend on you and we're small, we have this intimacy so. So I really want to know about you, because I really depend on you and we're small enough and intimate enough. I really want to get to know you. I think we can level it up, though, and make it a deliberate practice. I think it comes out out of just natural conversations hey, let's go have pizza together. I think there can be some deliberate activities.

Mike Michalowicz: 15:32

I'll give you one example that we have here in our office. I think, tina, you've been here, have you seen the tree? Have you been here? Have you seen the tree? Okay, so we have a tree in our office, on the wall outside of my office, and it's just a barren piece of wallpaper shaped like a tree, no leaves on or anything. But every time you accomplish a personal vision, you have for yourself a dream or desire, you fill it out on this leaf and you start putting on the tree. So the tree blooms.

Mike Michalowicz: 16:07

What we've been doing this for now about four or three or four years and there's hundreds of leaves up there, some things as innocuous as I cleaned out my attic but that was a dream. Someone had, like it's been frustrating. That person was Corday, been frustrating her for years and she put on her list and we said how's that attic going? And she actually took a half day one day and just got done. She's like thanks for supporting me in this. I would never got done otherwise. Right next to it is one that says five years cancer-free. That was Amy who said my dream is never to have this horrible disease to come back.

Mike Michalowicz: 16:44

All the dreams are important. We shouldn't rate the significance to what it means to our colleagues, but we also need to celebrate it, so that's part of our practice. It was about a year or six months ago. I said gosh, there's so many leaves up here. I think we should pull all the leaves down and restart.

Mike Michalowicz: 17:00

And my colleagues eight of us here at the office said no stinking way, those leaves stay up forever because that's meaningful accomplishments and it's not recognized in other parts of my life. Not their words, but definitely the intuition that came, the intonation that came out of what they were saying. So I said, well, how do we celebrate all of the new visions that are being accomplished? And I think it was Andrea who said, well, why don't we get flowers and start putting them on the ground and why don't we put clouds and birds up? And everyone will be a recognition of something we accomplished. And, by the way, you write down exactly what you did on it, you sign it, you put the date and you put it up there. It's a good way to pay homage to your colleagues' dreams and visions and, selfishly, reciprocity. When we care for each other, each other cares for the whole group and the business gets elevated.

Tina Smith: 17:48

Yeah, so can you give us some idea of the overall framework from getting employees to be all in?

Mike Michalowicz: 17:56

Yeah, sure, sure, sure. So it's an acronym F-A-S-O. Faso kind of rhymes with lasso, and there's four elements I dove into. First is a fit. When we do what we like to do, it's no longer a job, and I know we've heard this and you've experienced it. There is another great book out there. It's called Working Genius by Pat Lencioni, and he talks about identifying where your fields of passion he calls it genius are and how excellent we can be when we do what we're great at.

Mike Michalowicz: 18:32

So the first job of a leader is to realize that every human being is actually an A player. There's this fallacy out there that 10% of the population is A players. But when I survey audiences I'll say, hey, just in this room, who here is an A player? And I'm like don't be bashful here, I want to know the God's truth. Every hand goes up in every room I'm in and I'm like this is the truth. Everyone's an A player. If we are doing the right thing, that compels us, that gives us energy and drive. It's the thing we want to do, we feel called to do, and some of us need guidance to find that. But we definitely know when we're not doing it.

Mike Michalowicz: 19:08

So the first job of the entrepreneur, the leader, is to identify where can people excel? Do you have a person in your store who's the great communicator and just really is great at socializing? How do you have them engage the community more? Do someone who's great at vetting out products, negotiating the purchasing or something move people toward that? And the ironic thing about when you find and develop people's desires, they don't need to come with experience. I think there's a thought like oh, you know, someone's got five or six years experience doing this. They have to know what they're doing. No, no, no. Someone who's thirsty will learn really fast and will learn your way. So don't necessarily need experience, but you do need the next thing. So A stands for ability. You do need that hidden potential ability.

Mike Michalowicz: 19:54

Most organizations consider experiential talent. They say, well, what's your past? Because that indicates your future. As we know, that doesn't necessarily mean anything. Someone could say they can say whatever they want on resumes, particularly chat GPT. Now you say whatever you want and chat GPT will make you look amazing.

Mike Michalowicz: 20:13

But we want to look for potential. So the question is how do you find potential? So here's a super cool tip Run workshops. So the question is how do you find potential? So here's a super cool tip Run workshops. So what you can do.

Mike Michalowicz: 20:22

Instead of saying we're looking to hire someone, you can say hey, everything about working in the natural food space or natural vitamins and so forth, everything about working in the retail space. We have a workshop where you can come in and experience this for a couple of days, see what it's like. The interesting thing about workshops is you can even charge people for this thing, and it's even better you do this. Charge them 50 bucks because it vets out their interest and say show up, try this out and we will show you what it's like. Maybe you even want to run your own store one day.

Mike Michalowicz: 20:53

Now, the interesting thing is people that show up are truly curious. That's the first definition of potential. As we teach, we also observe, and the people who are curious they ask questions, show desire, are people that probably would be good employees, and there are certain people that hit the level I call thirst, where they can't quit. It's like this is who I am. So run a workshop to vet out people who want to learn, because learners are the A players. Right, we want to learn and get better at something that we've interest in, and the people who show thirst may be your employees.

Mike Michalowicz: 21:25

This isn't just theory. Home Depot next time you see a build a birdhouse workshop and you go down there to build a birdhouse, that is a recruiting platform. People are like no, no, no, they're trying to sell products Ultimately. They want me to be happy with the store. Yeah, yeah, yeah, that's secondary. They're recruiting. They want to see the people who show up curious. They want to see the people that ask the most questions, help other folks that are there, desire and the weirdo that comes like two or three times in a row every workshop, every weekend I'm building a birdhouse. They'll approach you and say have you ever considered working at Home Depot? You're the exact type of candidate we're looking for. You vet people without telling them. You're vetting them. You do it through education.

Mike Michalowicz: 22:05

Two more things, real quick. The S in this model stands for safety. You need to set an environment, of course, that we feel safe. Physical safety, relational safety, emotional safety. Those are all components and the leader has influence over it.

Mike Michalowicz: 22:18

I thought physical safety was something we had to worry about in the 1800s. This is how ignorant I am. I asked my office here. I said is there any safety concerns? It was an anonymous survey and they came back and said, yeah, the alleyway, on the side of our office there's an alleyway that goes to the parking lot. They said it's pitch black and when the sun starts setting you know, this time of year by five o'clock, four o'clock, it's getting dark. We're leaving. I'm afraid about of leaving the office and going down this dark alleyway. And, uh, I started thinking about around noon. So half the day is wasted and worry. I'm like, oh my God. So we put string lights up and it's super bright and you can see exactly what's going on. You can see all the way to your car and it's brought around this level of safety. So we have to evaluate these things.

Mike Michalowicz: 22:58

I'll tell you that that's maybe obvious. If, once you ask, I'll tell you something. That's not obvious is financial safety. I think what many leaders, small business owners think is I need to pay my people more. That gives them safety and it does not.

Mike Michalowicz: 23:12

Financial safety comes out from financial understanding, and one way that employers can help with this is by having open books. We've had open books now for 10 years. We don't share salaries. That's all blended in expenses because we want to protect people's privacy. But they know the healthy organization and what's so interesting about this is when you know the healthy organization, you have a security that your future is secured or not. If the organization is struggling, you know that maybe it's time to take action, but you see what's going on, as opposed to this opaque reality, master mystery, where you don't know what's going on. So we have open books and what I found is that people feel comfort in knowing the health of the organization and feel much more secure in their positions.

Mike Michalowicz: 23:58

Yes, you have to pay people a competitive salary, but not everyone's driven by a salary. Actually, many people are driven by lifestyle and salary is secondary to them. They have secured themselves financially to the degree they want to. They want a comfortable lifestyle, and so they want to. They want a comfortable lifestyle, and so they want to make sure their position is going to be there. So open books doesn't just educate your employees. It gives them a sense of security.

Mike Michalowicz: 24:18

The last thing is ownership. Ownership is where someone feels and acts like an owner of the business. It's actually the number one thing I hear from people is I wish my employees would act like owners. So how do you get someone to feel like owners? You don't give them equity. Equity, in fact, can result in entitlement. There's these ESOP programs and stuff, where you own a small part of the business. What seems to happen disproportionately is employees say I own some. Now Where's my money? You owe me. That's entitlement. Instead, you can use what's called psychological ownership. That's entitlement. Instead, you can use what's called psychological ownership. Psychological ownership are the psychological triggers that cause someone to feel that what the business is is actually part of them. There's an association of their identity to the business. The business is me and I am the business. And you'll hear that in employees when someone says you know, I don't know if, if the store or your store is selling as effectively as it could, as opposed to I don't know if our store is selling as effectively as it could. When you hear our or this is my job. That's a definition of possession, meaning that I associate myself with the organization. So how do you invoke it? Give people intimate knowledge, ability to learn skills. You do it through control, meaning that they have authority over something. Many business owners become micromanagers, actually stripping away control. So people don't feel that they have ownership. And the last thing is you give them the ability to personalize. How do I make it more of my own? I'll give you one quick example. I know I'm doing a big diatribe here, but I wanted to give the full context.

Mike Michalowicz: 25:50

If you rent a car, you clearly don't feel ownership. You leave that Hertz or whatever and you do donuts in the parking lot. We definitely abuse the car and we surely don't wash it before we return it. But when you own a car you might get it washed occasionally. You're probably not abusing the car and doing donuts. You're not skidding into every single light or peeling out when it turns green.

Mike Michalowicz: 26:11

Why is that? Because you may not even own your car. Maybe the bank who legally owns it. But we feel like we own it. We even say we own it. Why? Because you personalize it, program all the radio stations. You probably don't program the radio stations in your rental car. You put a bumper sticker on your car or window sticker. You probably don't do that with a rental car.

Mike Michalowicz: 26:30

You determine when you want to drive it. This is a control when you want to drive it, where you want to take it. The rental car probably actually gives you rules Can't take it out of the country, can't do a certain amount of miles. You can do what you want with your car control and you have intimate knowledge. When you bought your car you may have gone through that entire manual. You know, in the middle of January, shivering to death outside like, what does this button do? Do you even read the manual in the rental car? You just want to know where the turn signal is. Those three elements are significant in giving someone a sense of ownership, even though they don't, in this case, the bank, owns it. You know, legally own something, so you can do that in your business.

Tina Smith: 27:05

They still have printed like car manuals. Printed like car manuals. Yeah, have you bought a car recently?

Mike Michalowicz: 27:17

Oh, they do, it's always in the glove compartment, I'm just teasing you.

Amanda Ballard: 27:19

I'm teasing you, I know. So, Mike, I do have a question about this whole open books and ownership and where that maybe overlaps a little bit. So I know you said you know maybe not necessarily give them equity stake in the company, but something like doing a commission or some sort of profit share type situation in an area where they feel like they have ownership. Is that something that you found works well?

Mike Michalowicz: 27:46

Yeah. So we've tested that and it can be a motivational factor. I am consistently surprised how few people are motivated by money and what I found in my own organization. So this is an antidote, more than data. We have eight of us here. We do a profit share and we do it every quarter.

Mike Michalowicz: 28:07

20% of the profits that come out of the company get evenly distributed, regardless of your salaries. So everyone gets the same slice and no one really says anything. It's like and I'm not, I'm not. It's not ingratitude, they're not ingrates, it's just. This is normal. And I said well, why are we doing this If no one's like thanks, mike, and let's, let's push forward next quarter. And I'm like oh, for me as the leader, it makes me feel good, I feel that I'm doing something to honor my colleagues who are putting an effort in here. So profit distribution, I realize at least in my case, but in other people's cases too it's really a reward for the giver, not the receiver. So observe and play those tools.

Mike Michalowicz: 28:47

The interesting thing is people will say, oh, money's a motivator. Absolutely, I'll work harder for a commission. The reality is, when people are fully embraced and encouraged to be their full selves, they go all out. I suspect both of you play all out in your businesses on your podcast, not because of the compensation you're receiving, just because that's the nature of who you are and that's what I believe most people are is when we're in the right environment, able to express ourselves the way we want to express ourselves, we will play all out. I'm not saying everyone will play all out for any company because it may not be a fit. In fact, small businesses where we have four or five employees, most people that you consider won't be a fit. That's why we got to do these workshops and test people out. Those are A players. It's not A players for you. They need to find positions elsewhere.

Tina Smith: 29:36

Yeah, I want to talk before you leave about this return on payroll concept that you talked about.

Mike Michalowicz: 29:43

Yeah, yeah.

Tina Smith: 29:46

So tell us about you were talking about three times the salary should be where the revenue is when you hire an employee. Tell me more about that and where you've seen it work or what tweaks you make when it's not working.

Mike Michalowicz: 30:03

Yeah, it's a rule of thumb. Most small businesses become overstaffed and they are so burdened by payroll it's a slow death of the business they can't sustain. So what we do is we use as a rule of thumb so if a business is doing, let's say, $300,000 a year and overall payroll and this includes the owners is 200,000. We know that business should really be doing about 600,000, three times payroll to be in a healthy position. We know immediately there's red flags and we have to go into a deep evaluation. So that's what it's used as it's just a rule of thumb analysis on the fiscal state of a business.

Mike Michalowicz: 30:42

For most retail businesses, the number one expense is payroll and number two is rent or ownership of the building. Sometimes the building comes first and then the employees come next and then inventory. Those are the big three. What's interesting is when it comes to cutting costs on inventory, it's a thing we're like, yeah, yeah, when it comes to cutting or controlling costs with employees, that becomes a very emotional decision. I've had this person for two years. I can't let them go.

Mike Michalowicz: 31:09

So it's the thing that we become least critical of or we become most avoidant of, and that's why that number is so important to understand so you can make an appropriate decision. I will share this If you are overstaffed and your business is dying. This belief that I try to save everyone while my business collapses is like saying the Titanic's going to float again. No, we got to get people off the ship, and sometimes you have to save the ship by letting a few people move on to other opportunities so you can get the business to be fiscally healthy again. And that's a very hard decision. So we have to look at the numbers first.

Amanda Ballard: 31:44

Do you do that over a period of time? You know initially when I make that hire. If I'm hiring someone for, you know, $60,000 a year, I expect to see that three X return.

Mike Michalowicz: 31:56

Yeah, I expect to see 180. Yeah, it may not be overnight, but that's gotta be my plan. And so if I hire someone today that's making 60, I got to say this business has to be bringing an additional 180 by such and such period.

Tina Smith: 32:16

And I commit not to making more hires or any more decisions in the meantime until this person is doing that. Yeah, and I would just encourage anyone that if you find that you're overstepped like you're talking about like the burden financial burden is heavy on the employee side of things and this math isn't working for you. Look at profit first, because there are a number of things that you can do, which will include evaluating and like moving people out if necessary, but there are also other things where expenses are too much and ways to create more revenue that you're probably just not thinking about right now, and revenue will solve a lot of problems for businesses, like sales growth if done well with the same amount of staff, will solve a lot of problems.

Mike Michalowicz: 32:55

That's exactly true.

Tina Smith: 32:56

Anything else that you just want to close out with?

Mike Michalowicz: 33:00

Well, if I can share the resource, mike Motorbike nickname from grade school, the only PG one I had, as in the motorcycle mikemotorbikecom. All my resources are up there pre-booked chapters and so forth.

Tina Smith: 33:12

Well, thanks for joining us for that episode with Mike Michalowicz. That was super fun and I always enjoy chatting with him as we were going through the all in a book that he's written. I was just thinking about I wonder if this is what he did to help me find my fiance. Did he create a workshop situation? And I'm sorry he's not on here to enjoy this right now, cause he is so proud that he introduced me to the man I'm now marrying. Well done, mike. He thinks that he should start. We've talked about like he has 15 businesses, but he thinks he should start a matchmaking business because it worked once.

Amanda Ballard: 33:54

I mean, you got to start somewhere, right.

Tina Smith: 33:57

He has 100% record that it works and I'm only sharing this because we actually got engaged at the Senpa show in September, so it's something I mean. I just feel like this community is part of my whole story now, both my business, mike McAllen's community and now the natural products community. So it's been the whole way along our journey. So Mike introduced me. You guys are where we you guys are where we.

Amanda Ballard: 34:38

I said, yes, all the things.

Tina Smith: 34:39

So the stars aligned and everything is great. So thank you, mike Michalowicz. Yeah, anything um Amanda that kind of stuck out for you as he was talking through the process of All In.

Amanda Ballard: 34:48

You know, one of my favorite things that he said and as I've been reading the book is that every person is an A player, and I feel like, in working in retail for as long as I have, it's easy to feel like there's B and C players on your team and get frustrated, and I think that there's something to be said about.

Amanda Ballard: 35:15

Everyone is an A player.

Amanda Ballard: 35:17

They just might not be an A player in your business, and so if you can find a place for them in your business where they can shine as an A player, do that if you want to keep them around, if there is an opportunity for them to shine in that area, but if not, there's an opportunity elsewhere, because everyone has their own unique ability.

Amanda Ballard: 35:39

So I thought that was a really important reminder, just because it is so easy to get frustrated with underperformers, but knowing just how valuable people are as individuals and I love that he was talking about his, you know this community that he's building within his own teams, and I see that in the stores that I've worked in and visited, they really are almost like family, and so I do think that that is something that again sets these independent businesses apart, and as long as we just are always thinking about how valuable people are as individuals. Whether or not there's a perfect fit for them in our company is one thing, but just a reminder of how important it is to treat people with respect and remember how valuable they are.

Tina Smith: 36:31

Yeah, and you know another thing that stood out to me because I've seen it happen. So as he was talking about it, I was like, oh my gosh, this reminds me of that scenario that happened with this retailer. But he's talking about these workshops and using them as well. You're educating, which is huge in this industry. You're educating the public, but the people who come and attend over and over again, they're the people who are most interested in the type of education that you want to provide to everyone anyway. And then, second, they are probably people that are referring they're probably super referrers to educational events or whatever they've learned.

Tina Smith: 37:13

If you watch the people who have learned things in your workshops, the next time they're in the store, if they're sharing that with another customer without being prompted, that's a perfect opportunity. And it just reminds me of when someone has a health issue and they're willing to help someone else and we've seen that happen and then they end up being a really great employee and talking through that ownership piece of it. Then they start to own a particular section and they attract more people like them. So, whether it's hey, I'm a mom, I deal with this chronic issue for my kid or pets We've totally seen this happen in a pet department.

Amanda Ballard: 37:59

Yeah, absolutely, and I think you know customers really can make the best employees as long as they're given opportunity, an opportunity and I know that there was something that we wanted to talk about and we didn't have the time to but building a bench for when you have a need almost like making a list ahead of time of these are whether it's a potential, whether it's a customer or someone you've interviewed in the past, or a previous employee that's maybe moved on even though you absolutely loved working with them, whoever they are. Have a list of potential bench people that you could pull in whenever you have a need that needs to be filled. I thought that was a really good insight from the book.

Tina Smith: 38:43

Yeah, you know. What else, though, about that very topic, I was thinking about having the bench available. Like, you start having these conversations and you realize that someone could be a really good fit for working with you, but you don't have a position yet. I think the stores have opportunities because they do these events, whether it's a health fair or something's happening on a weekend, and they need extra people to hand out samples or something like that. It's the perfect time to offer some compensation for a short period of time, like, hey, would you be willing to come and give us a hand at this event? All we need you to do is pass out samples for this thing that you already love and talk to people about it, and we can pay you. And that way, you're not overstaffing up and they're getting to know you. You're getting to know them where you're kind of having this trial period of dating, and then, when a position's available and they're still interested, hopefully then you have someone who's ready to fill that role.

Amanda Ballard: 39:52

Yeah, absolutely. I think that's wise and I've seen it play out so I know it can be done. So it's definitely it requires nurturing those relationships and just staying in touch. But I think it's well worth it, because you never know when staff can change and to be able to pull people in, at least having that relationship available to you. They might say no, they might not be interested at the time, but you at least have a place to start, as opposed to just posting a job listing on a job board somewhere.

Tina Smith: 40:31

And it's probably your customer, yeah, like, because those are people who are most interested in what you're doing. So I mean, just think about the number of customers that are coming through these stores. There's a whole job pool sitting right there because they're already interested in that kind of work you're doing and they could be great so you get to have that customer interaction with them every day. So I would be on the lookout. If there are customers helping customers, that's a good sign. Yep, okay, I think that's it for the Michalowicz episode. His new book is all in. You can get it on Kindle, amazon, get it shipped to you, or I would highly recommend Audible because he's funny when he reads, he likes to perform, so I like to listen to him read his own books. But the other books that I love are Pumpkin Plan for Small Business Owners Profit First for sure, because that can really help you get your financials balanced out and working correctly. Clockwork that can help you with your operations and managing systems in your business.

Tina Smith: 41:40

And Get Different is a marketing book that we love and use and could talk a lot about that book. A lot of different. There's a framework in there that helps you figure out what makes you different, and we talk about that all the time but also just some blocking and tackling with marketing tactics that come from that book that are really great, and then his latest book, all In, which is all about employees. So Mike is always coming up with a new book and a new business. So be on the lookout for what's next from him, because he is one of my go-to business leaders that I trust. I know he's done a lot of homework and he's gotten a lot of great advice from people who are in it and are doing it every day that he can bring to the table, and so it's solid. Every time he writes a book I am absolutely on board.

Amanda Ballard: 42:34

Thanks so much for listening to the Natural Products Marketer Podcast. We hope you found this episode to be super helpful. Make sure you check out the show notes for any of those valuable resources that we mentioned on today's episode.

Tina Smith: 42:45

And, before you go, we would love for you to give us a review. Follow, like and subscribe on Apple Podcasts, Spotify, YouTube or wherever you're listening today, and make sure you join us for our next episode, where we give you more marketing tips so that you can reach more people and change more lives.