The Small Business Supercharge is coming in hot and you are just days away from learning some incredible ways to completely revolutionize your small business and navigate these uncharted territories. Leading up to this virtual conference, I (Stephanie) wanted to give you a little taste (a little appetizer, if you will) of who we are talking to and why. I had a chance to sit down with Linda Ratner, a highly successful entrepreneur who received numerous accolades for her business adaptions and skills before negotiating a multi-million dollar business sale and becoming a certified EOS implementer. When it comes to business, this gal is fire.
I am excited because Linda and I have been running in concentric circles here in the San Antonio business world (which is where we are both from) and we started chatting a couple of months ago after several people said, “You have to meet Linda!”
Long story short, we finally met, and she is fantastic. I am beyond excited to have her present as her story and wisdom are incredible.
Here is our discussion:
You have an incredible background in business. You have built businesses, you have sold businesses, you have run multiple businesses. So, what is your business story?
My grandparents immigrated from Europe in 1929 to Mexico City, where I was born. They were always entrepreneurial, so that was rooted early on. In 1974, my whole family moved to the United States because my Dad, who was a mechanical engineer, decided to open a business (a store) in Laredo, Texas. So I went from a city with a population of 25 Million to a city of, at that time, around 25,000.
When we arrived, none of us speak the language, right? We are all completely fluent in Spanish, and English is such a hard language to learn! My parents, who were in their 30s, picked it up first, and eventually, we did as well.
On the weekends, we were always supposed to go to work the store with them. So I grew up working in the store. Before I could even see over the counter I learned to sell. By the time I was in fifth grade if someone paid in pesos, I was able to give them change in dollars (or visa versa), I was good at the conversions and running the cash register.
I truly learned all kinds of things, but by the time I was 18, I learned I did not want to inherit this business! There was no way I was staying in Laredo one more minute. The plan was, as soon as I graduate, go to the big old town of New York City, get a degree, and become this big lawyer! Well, I got as far as San Antonio! In 1982, the peso devaluated, and my Dad lost everything in the business. Everything! He did not have a good plan or any kind of safety net. So he said, “If you want to go to school, you will have to do it on your own.”
So I used my $200 savings, moved to San Antonio, and enrolled at The University of Texas San Antonio. I put myself through school and ended up with a nursing degree. The interesting thing is, I am terrified of blood! When I was getting ready to graduate from nursing school, I would have to leave the operating room because it is too damn bloody and I would almost pass out! I worked really hard to convince myself that it is just KoolAid. So, I graduated and went straight into the emergency room.
Where you can totally avoid blood... I mean, you never have to have blood in the emergency room! Never.
Never! But, it's all too late that point and I conquered that fear. I thought “I need to be in the ER because I am very autonomous and being on the floor would have driven me insane!” So I went straight into the university hospital here in San Antonio, which is a level one trauma center. Eventually, while working in the ER, I met my husband (he is an ER doctor). After we were married, we would always come home and discuss how so many ER patients were there that did not need to be there! They were just taking up a lot of resources from the people that were really sick.
So I said, “It would be great if we opened some urgent care centers!” and he responded, “Yeah! We should do that!” We opened our first urgent care center in March of 2010 and it just took off. We were seeing a ton of patients, BUT by June, there wasn't any more money in the bank! After a $1.5 million leverage, there was no more money. So I thought, “Something is wrong!”
Before opening, we just thought, “Hey, I am a nurse, I can do this. He is a doctor, we can do this!” But we had no idea about sales and marketing, and no idea about finances. Then there is this whole people component, like keeping people accountable. You know?
Based on some of the definitions you have on your website, we went right into the “business operator,” because we started out with 12 employees. So for the rest of the year, I learned how to code and the financial part that I totally had ignored, seriously, ignored! Then I fired my accountant. I fired the billing company and learned to do it all myself.
By January, we turned it around! Then we hung another year and things got really good, we opened our second location that did well and a few years later, we were bought by a private equity firm. I stayed on and helped open five more locations in three years. Throughout the San Antonio markets, we had seven locations, and of the equity firm's 140 clinics nationwide, we were number one across all metrics that I could control -- all because of some of the things that I learned and had been doing!
You hit on some good points there that I want to emphasize because I think a lot of times business owners get into business because they are good at their functional skill. It is funny that I am talking about this because when I look back to when I started the business in 2014, it started a sales training business because I was hella good at sales! I was great at my functional skill. I could sell out the wazoo, which is a great skill set to have if you're going to start a business, but it's only going to take you so far! Then you actually have to run a business.
I think a lot of people do that, they are good at sales, or they are a great nurse or a great plumber, but they do not understand the rest of it! They expect to be able to hire someone to do it, but the problem is, no one is ever going to care as much as YOU do, right?
I can hire a bookkeeper, but if I am not actually checking my financials and understand what I am reading. So I love that you touched on that because I think it's hugely important.
Now I know you work with Gino Wickman with Traction, you are also a Profit First Professional with Mike Michalowicz, and you talk about having an Operating System (OS) for your business. When you are talking about this, what does that mean? Because I think that is a very foreign concept to a lot of people.
It is! Most people think that I am talking about some sort of computer software, and I am not! I am talking about strengthening the six key components of your business. Every business has some division components issues. So, how do we get to the root cause of the issues and solve them so they do not keep happening over and over again? There is a process component. This is the secret sauce to every single business!
If you do not have the right processes in place, you cannot scale and you cannot ever leave your business! How are you ever going to take a vacation? Then the last piece, which Gino called traction, encompasses the accountability and discipline of every business.
When I think back, I was really great at operations. Like how you rocked the sales piece I rocked the operations piece. Our clinic was awesome! But my skills stopped at accountability and I had no clue what I was doing with finance. None. I could no read a financial statement to save my life. So I could not even hold the person accountable if I wanted to.
That is a challenging skill to develop -- holding people accountable -- because I do not think that we always do a great job holding ourselves accountable and managing ourselves. For a long time, I way over-managed and was way too hard on myself, which led to me being way too hard on team members, too. So there is that balancing act of, “Let me hold you accountable but also, this is not about me weighing you down or babysitting you.”
These are all skill sets. It would be wise for a lot of business owners to take an analysis of which skill sets they have and which are they are not as strong or lacking in completely. Start shoring up those individual holes inside the business and create a process for those six key pieces.
Now, I know you are going to talk about that a lot more at the Small Business Supercharge, so we will not go into too much detail here, but from your experience how, does having these operating systems in place for your business help you grow?
Let us just start with the processes. You cannot scale a business if you do not have processes in place. Think about if you were opening a Jimmy John's or a McDonald's. They do not keep reinventing the wheel every time they want to open another location! You as a franchise owner, pay a substantial amount of money and you get the processes that are proven to work.
So I teach my clients to create that system. Even if you do not want to scale in terms of opening other locations, you definitely want to become much more profitable and efficient. So, we need an operating system. That just means that we are going to do the right things in the business the same way correctly over and over again. That ability to duplicate the process for yourself and your employees allows you as a business owner to go and have a life. I do not know anyone that opens a business to become a slave to it or to have it control you. That is never the dream but that is often the reality!
Many delude themselves into years of thinking, “Well, I am investing time so it will payout down the road!” You know, if you have been investing time for five or six years and you know, nothing has changed, then something has got to change!
This is what I am excited for you to share with us at the Supercharge! The processes. Referencing my definitions of the job owner, the job operator and the business owner, where the goal is to get to being a business owner.
You have the job owner, that is what I was when I opened my company. I was a sales trainer and I was the owner of a company, but really at the end of the day, it was me and a couple of supplemental people. I basically owned my own job!
Then, you know, I transitioned into a job operator where people are working for me but I still could not really walk away.
Then you have the business owner, someone who could pay themselves a reasonable market wage to do the work that they are doing and could replace themselves if they wanted to while still taking a profit distribution! That is the goal for all of us. Now I am getting closer and closer to that true business owner level, and man, that feels really awesome.
It is an accomplishment! 80% of businesses are going to fail, so to make it close to a business owner is an accomplishment.
I think the main thing is, when starting a company, you cannot forget that you have got to do the thing you do not love doing when you are that job owner. You cannot ignore those things.
You are absolutely right, and that is one of the reasons you want to get out of being a job owner because it is not a fun role to be there longterm.
Now that was just a little taste of the Small Business Supercharge! During the event, Linda will take you through the steps to create these magical operating systems!
Jun 11th, 2020 | 9 am CST
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