7 Essential Tips For Hiring A Business Coach Or Consultant

all right i'm fired up today let me tell you what i've got something that's kind of been on my mind for a while and i want to talk to you about [Music] consultants [Music] all right guys i think i've got something you're going to be interested in today and that is going to be the seven tips that i have if you're considering hiring a consultant or a business coach the first thing we're gonna do before we get into those seven secrets is we're gonna have story time so like everything i'm telling you this because i know a thing or two because i've seen a thing or two and i have made almost every mistake out there so we're going to talk about the mistakes that i've made when i went and hired a consultant slash business coach whatever you want to call it but now most of you have seen the video series that we did on olson fencing and how i failed through that business and one of the things i talked about briefly in there is that in 2007 when my brother and i were fighting over a business that was worth no money we hired a consultant somebody came just wandered into our door one day and said hey you know what maybe you guys could use this and say took a look at some of our books and stuff and told us that we needed all kinds of help and now sure we needed help but i think they were going to tell us we needed help even if we didn't need help they just happened to stumble upon a couple brothers that didn't know what they were doing so we hired them and over the course of about two months maybe a little bit more i'm gonna say two two and a half months from memory if memory serves we paid them about a hundred and ten thousand dollars to teach us basically how to run a business and so they went through everything they taught us how to read a profit loss how to read a balance sheet what the difference between the two were how they were integrated they taught us about how to better manage our team members how to build a team how to make sure that we knew what profits were making on each project how to job cost how to run incentive programs i mean it was basically taught us each and every aspect of all the things that we didn't know that had led us to the mess that we were in that was 2007 so 2008 they set us up and we knocked it out of the park all 2008 and then after that the market or the economy crashed and we continued to struggle just because we were seeing some new things that we didn't have the skill set to deal with and then made a whole series of mistakes there and if you want to know more about that that's on the video series for how i failed in business but the long the short is we paid him about 110 000 now looking back on it would i do that again probably not i would do things significantly different because i could have got that same education a lot cheaper through some other sources and we'll talk about that later on now fast forward to starting over again after olsen fencing starting over again as swi we had a whole unique set of problems there because after having failed in business not a lot of people had a lot of faith that i was going to be able to pull it off again and so obtaining credit was extremely difficult justifiably so i just failed in business so nobody was looking to help us out with capital so we were starting from scratch all over again and unlike when we started olson fencing we just had no credit now i had bad credit which was even more of a struggle trying to get going again because when we started with holston fencing the phone wasn't even ringing and when we started with swi the phone was already ringing so there was already a significant amount of business and the business needed significant capital to operate we kept trying to talk to some banks and get some financing here and there and everybody was like kind of encouraging i mean some of them wanted to just shoe us off with the broom but after about two years of operating we thought well maybe we'll have a shot at it now because we've got a good history of some profits and we've done really good for the last two years and so we started talking to some banks and i still couldn't get any help so i think it was about year number three in business after starting over again we went in and finally talked to a bank and it's one that we had been talking to before and we brought him all of our paperwork and said hey you know we're really looking to get in with the bank and develop some credit again and they looked at everything and after they discounted all of our assets and realistically discounted them so they were doing things like we had maybe five hundred thousand dollars in inventory and they were discounting that down to like 25 percent and then they were taking all of our skid steers and stuff that we had bought and paid cash for and they were discounting those so if if we thought they were worth a hundred thousand they were discounting all those like 50 and they look at all this after they've heavily discounted every single asset that we own and said oh my gosh you guys are underwater they basically said we're scared to death that you guys are going to go out of business tomorrow but the reality is is that those assets still had much more value than they were giving us credit for looking back on it so they kind of freaked me out after having gone through a failure kind of freaked me out a little bit and i went and said well i must still be lacking some knowledge so i need to get somebody that can help me out here and maybe coach me through some of this stuff so we can actually get in with the bank so i went looking searched on the internet and was looking for a consultant to just kind of help tutor us again and found a guy in colorado talked to him a little bit he had been an accountant and and seemed pretty reliable had a couple meetings with him and stuff and and he said yeah yeah i think after listening to us he said i think i can help you and i don't see any worries from what the bank's telling you and i see no reason that you guys shouldn't be able to make it and we can get you some financing and stuff like that so he presented us with a consulting agreement that i'm looking at right here and i won't mention any names but said oh yeah yeah we can we can help you with that and i've got a lot of experience in construction and and here's what we're going to do so he basically sent us a send us an agreement and we took over took a look at it and we talked about it and we thought you know what i mean we probably need the help i guess so what unsigned it so the project description is monthly review and analysis of financial statements to determine areas of change necessary to obtain financing because that's what we're trying to do follow-up discussions on how to capitalize expenditures for ease of financing he was supposed to visit six times so every month we were supposed to have meetings six times every other month i was supposed to go to him and this was in the fort collins colorado area so i would travel down there and meet with him and have in-depth meetings over what we needed to do and kind of look over our financials and stuff and then six times he would come to us it says specifically four times he would visit us in casper and two he would come all the way to powell we have unlimited access to all the intellectual capital of our professionals through telephone email meetings change order will be issued if the scope of the consul consultation turns into a new project you are not inhibited from seeking timely advice by fear of the clock running continuously so basically what he's saying there is is you're paying for these services and you have unlimited access to us so anytime you need us give us a call our services are designed around fixed prices as opposed to hourly rates and offer you access to the accumulated wisdom of the firm professionals with substantial experience who can help enhance your company's future and achieve business goals that all sounds great while the fixed price entity entitles your company to unlimited consultation with us if your question or issue regard requires additional research and analysis beyond the consultation that work will be subject to additional price so it's basically just talking about change orders so basically we talk about anything financial in our company's goals and where we're going to go and how we're going to get the financing that we were looking for for a firm fixed price now here's the fee schedule it says that every month we'll pay them three thousand dollars a month so over the course of the year that's thirty 36 000 then it says contingency fees swi agrees to share in the success of the consulting agreement with blank with the results to the services referenced above for the period of january 1st through december 31st 2017. swi will pay a blank seven percent of the net income on an accrual basis calculated on an annual basis and do 45 days after year end and that's basically what our agreement looked like now let me tell you what actually took place so we started the agreement and it was nothing but a complete train wreck and we continued to pay all this money out and three thousand dollars a month and we were sending financials and they were supposed to be helping us get into you know make sure that our financials were super strong so we could get into a bank and basically we would send them financials and and really got nowhere we finally did end up obtaining some financing but it was extremely expensive it took them probably eight months at least just to even get us into a really crappy agreement with a bank so it wasn't really a good situation we continued to make money just because we did our job and then at the end of the year we owed them thirty six thousand dollars and we owed them seven percent of the profits but they really didn't help our financial situation whatsoever so at the end of that year i said you know what um one of the things is you said you were going to come visit us six times and you came once one time all the rest of the times i had to go down there to them even though the part of our agreement said that they were supposed to come to us all the way up in powell at least two times they didn't do any of that um so i was a little he says oh no no we'll we'll do better this next year and you know just reassured me that everything's going to be fine and we'll help you get into better banking this year and you guys had good strong numbers last year and of course we had good strong numbers because we did our job and then paid out the seven percent that we were obligated to pay out even though they had breached the contract by not doing the things that they said they were going to do so fast forward to 2018 we signed another agreement and um they assured us that everything was going to be fine and the agreement looked much much like that one only we were able to get in with the bank but the funny thing is is that this gentleman led us to his bank and that bank required us to uh just to make sure that he was he was locked in uh they said yeah we'll we'll sign on with you guys and we'll give you guys all the loan the loans that you guys need but what we need is instead of you paying him seven percent since you're just gonna give him seven percent anyhow at the end of the year we need him to be a seven percent owner so he took us to his bank his banker and then basically s schnookered us somewhat into giving seven percent of our company up for nothing just so that we could get the financing looking back on that that was a horrible decision and i made i regret that decision a lot because it led to even more problems because him and the banker were like in cahoots basically the banker was getting all kinds of money because he's getting his interest rate and he knows that he's got this other guy on the hook you know so if anything bad goes wrong he's got him but then this guy is getting paid by us so it's it's a real friendly situation between the banker and him and the swi is sitting here footing the bill for it in 2019 we said that's enough of this garbage we're not doing this anymore and we basically cut all ties but we did have to get those loans paid off so he was entitled to a seven percent as an owner until and then in the beginning of 2020 we were finally able to get him all the way out and cut him off completely uh executing our dollar buyout of his shares that we had given up once we paid off all those loans so that was my experience with that consulting now in the middle of all that we got into another agreement where i met a gentleman at fence tech which is our annual trade organization and he said you know what we're going to help you know we're marketing what we do is we help market fence people specifically and we're in the fence business and he says you know we're just looking for some people and he started out really good and the fees were pretty low it wasn't a big deal said you know we'll charge you hundred dollars a month and we'll help you make sure that your website's seoed and will help you do some google advertising and stuff of that nature i think we're probably the first customer that this this person had ever taken on so you know i'll gamble with it a little bit we signed another consulting agreement for marketing now in the very beginning i would say that he did a halfway decent job of doing all of his marketing this thing was called defense marketing team so i am specifically going to name that because if you're coming to us from defense industry whatever you do my personal opinion is stay all the way away from fence marketing and scott andreas and that's my opinion nothing good is going to come from that agreement i think that this is this is a person that is exactly why i'm doing this video so the the person in the beginning that i told you about that we paid 110 000 to i think they did the best job but they took the most money right up front in a very short period of time the second person that i got into consulting agreement took probably about as much money only over a longer period of time and then this defense marketing team took a decent amount of money but it was nothing that was going to kill us but what ends up happening with these things and why i want to warn you guys about consultancies is because in the beginning especially if you get it on the ground floor everything is going to look pretty good and everything's going to work pretty good they're going to have very few customers you're going to get really good hands-on they're available when you call them they're attentive to your needs they're doing the things that you need so everything goes pretty good but then what happened is i started telling other people i you know we're using these guys and i think they're doing a halfway decent job and so they pick up more and more customers and then pretty soon what happens is because it's a one-man band there's no time left and so what happens is that everybody gets less time and then all the work that's supposed to be getting done doesn't get done anymore and so then they're in this they're in this balancing act where they're trying to make you think that they're doing some stuff but they're really not getting anything done and that's exactly what's happened with the consulting people that i dealt with in colorado and defense marketing team is the more time goes on the less they do so in the very beginning they're going to work really hard to show you that oh yeah we're worth it and you're getting all this money but once the agreement gets a little bit cozy and they don't feel like they need to do much they're going to do the bare minimum especially if they're taking on more and more customers in the meantime because they need to go recruit new people because the whole point is to sign up as many people as possible so they can keep that monthly revenue coming in and so as more and more people sign up the service gets less and less and less and then you have what happens with the defense marketing team is it basically implodes because everybody says boy this is just a huge crock of crap and we're all getting screwed and people are left very unhappy and i think if you talk to anybody in the fence industry that's been involved in this or knows a little bit about it they're all going to tell you yeah stay away away from this guy so i'm telling you this my story not to say that i'm perfect but because i am telling you that i've been through all this stuff and i can tell you how much it hurts you and the reason that people go and they find these they look for these consultants and business coaches and stuff like that is because they're struggling and so they're trying to find somebody to give them help and oftentimes too often what ends up happening is they find somebody ends up just picking their pocket and really not giving them the help that they need so i'm going to give you my seven tips starting right now of what to do if you're looking for a business consultant slash coach before we get into all these fine tips now that you've heard my story what i'd like to do is have you subscribe down below if you like what you were talking about and you think the content's valuable it would mean a ton to us if you would subscribe to the channel hit that notification bell so you know when we put up some new content and drop us a comment we love to hear what you guys have to say so never be afraid to drop us a comment and uh i mean you can you can say mean things you can say nice things we prefer the nice things but if you have something mean to say and you want to tell us how bad we're getting it wrong then i mean we're open to any comments and we're always taking suggestions the other really cool thing is if you want to support this channel you could head over use one of the links right down below in the description there's a link below we've got some pretty cool t-shirts coming out so if you want to support the channel and show your support of the channel think about picking up a t-shirt and sharing your successful contracting story sharing the successful contractor with those around you so without further ado let's get into the tips tip number one if you think that you need a consultant or a coach look for a mentor within your own business community or within your own association we are a part of the american fence association and what i should have done when we were running into some problems is i should have reached out to our association director who's tony thornton if you're coming to us as a fence contractor i should have reached out to him and said do you have somebody that you could maybe recommend to mentor us and help us that's got good strong financial backing and i guarantee you he could have hooked us up with somebody that would have been a look to our financials had some banking experience and stuff like that and been able to help us out probably for no cost there is a whole team of people within your own association or within your own business community locally that loves to see people succeed and if you get hooked up with the right people those people will help you oftentimes for zero dollars and that is the first thing that i would recommend is look within your own business community look within your own association look and see if you can find those people that are invested in seeing other businesses succeed because every single one of them feels your pain because they've been where you've been so look for those kind-hearted individuals talk to your accountant is another great resource if you're struggling financially an accountant can point you in the right direction and even they can consult you much cheaper than one of these consultants will ever consult you you're better off paying them by the hour than hiring a consultant but if you that still doesn't work and you still don't feel like you're getting the care you need here's some other tips so tip number two is always check references get reviews from some of their satisfied customers and i'm not talking about the five most recent if you talk to them and they say hey here's five people and all those five people just signed up two months ago three months ago four months ago and they haven't had one two maybe even three years of experience with this person be a little bit leery you want some people that have been with this consultant or this coach for quite a while and can vouch for their accuracy and their success and say yeah you know i've been with them for a very long time and and i always get good return phone calls and they always give me the time that i need so that's going to be number two make sure that you get some good solid references and you know who you're doing business with because one of the things that we see a ton in this industry are that people like me after i failed with wholesome fencing i don't start all over again and i just decide i'm gonna go out and coach other people you know who's the best coach is not the guy that just failed in business i might know some stuff but you need somebody that's gonna help you through the success not just the failure so if i would have started consulting with people right after our business fair failure with olson fencing i would have been a typical consultant and then no position to offer any advice to anybody given my track record so i think that the arena is full of people that are what we like to call big hat no cattle when you get involved with these people you don't necessarily know what their past experiences are so why are they consulting why why if everything else is good if they're running such successful businesses if they even are running a business why are they consulting or are they consulting because their business isn't making any money this is a way to get more revenue and a lot of times i think that's what's going on in the case of fence marketing team that's exactly what's going on it's all about the revenue stream um you know they have that saying and this is going to be extremely unpopular but sometimes it's very true and it's that those that can't do teach and i think the consultant business coach industry is filled with people that can't do so they teach and the last thing you want to be doing is taking advice from somebody that can't do it themselves they ought to be able to back up what they're doing and obviously they're probably not going to offer you their finances on their business which would probably be very telling if you could see see their last five years tax returns and see how much money they were actually able to generate from their their enterprise tip number three is going to be ask him how many people they're already coaching or consulting with um that makes a difference to you because if you are dealing with a consultant that it's just him he has a very limited amount of time or her i should say him or her they have a limited amount of time the more people they take on the less time you're going to get from this consultant so be very leery if they say they're coaching 20 people plus they're trying to run some other side businesses or anything like that because you're going to get very little attention from them and you're going to be one of these people that just ends up paying every month and getting very few results as a very few results out of them as an end result so ask them how many people are coaching and whether or not they're seeking new clients and if they seek too many new clients and they start running out of time what's their contingency plan do they have another coach that they're going to bring on and what are their credentials what's their expertise you know just because they say they can do it can they really do it that's what you need is you need their credentials and anybody that's going to be working with them to coach you you need those credentials and sometimes they're not very forthcoming on what their credentials are tip number four this is a big one never ever ever pay a fee on gross revenue ever let me say that again never ever ever pay a fee based on gross revenue and keep that monthly fee as low as humanly possible and i'm going to tell you why what people love to do in this industry is they like to collect money regardless of whether or not you succeed so the higher the monthly fee the more you're going to pay them even if you fail so i don't have to make any profit in my consulting agreement that i just read to you even if i didn't turn a dime a profit i still owe that guy 36 000 now the one good thing i did was make sure that it had a profit based profit-based compensation program on the back side but even if i didn't turn a dime or profit that guy is still going to collect 36 000 for doing next to nothing and i have a huge problem with that what would probably been better is like 500 a month and then even pay more on profit so if you're gonna get into one of these agreements try and keep that minimum that monthly fee that what they're collecting to a bare minimum i would keep that very low under a thousand dollars and the poorer you are the lower i would try and keep that because what they could actually do is help you accelerate your failure if you're really struggling it could cost you so much money that you end up failing faster because they're not doing their job on the other hand if you have a profit based goal what could happen is that they give you the time you need because they want to see you succeed their success is dependent upon your success and i wouldn't even say a profit-based goal like we're going to take 10 percent of your profits over the next year what i would rather see and advise you to do is if you're going to get into one of these agreements and you're already making a 10 profit if your goal is just to be more profitable i said 10 but i think a lot of people are making between 0 and 5 so if you're making a 5 profit and you're just trying to take it to the next level i would say you know what we're going to pay you 25 of our profits anything over 5 so have a sliding scale or something like that then they're well incentivized to make sure that you turn a profit because the only way they make a lot of money is if you make money but so many of these people will tell you that they want paid on gross revenue and anybody that told me that they were going to collect money on gross revenue i would run for the hills as fast as i possibly could because that's somebody that is only interested in landing their own pocket and has no incentive to help you so never ever ever pay on gross revenue tip number five is to make sure that you have your kpis clearly spelled out in the contract so not only are you going to get compensated based on the increased profit of our company not on gross revenue but here's the things that we need you to help us with we need you to help us get from here to here and here's how we're going to do it so at the end of the year i want to know how to read a balance sheet i want to be i want to be very well versed and have you help me so that i understand how to run job profitability and job costing or i need you to help me make sure that my quickbooks is set up and it's tight tight so that when i go in and take it to a bank that they don't laugh me out of there because it's a mess you know whatever it is you went to them for because you're struggling with make sure those kpis those key performance indicators are spelled out very clearly in the contract that you're going to help me with this this this and this and then you're going to get compensated based on the additional profit we make at the end of the year because you did those things with me be very clear in your contract and don't be afraid to spell every single little detail out don't get into some broad contract where they just say hey we're going to coach you all year and for that we're going to take 36 thousand dollars and 10 of your profit that's not a good agreement tip number six if they don't meet their kpis don't be afraid to fire them that's called breach of contract get your attorney involved and if you don't want to keep paying them don't be afraid to get them on breach of contract when they don't deliver i should have fired my consultant the minute he didn't do any of the things that he said he was going to do like come and visit us he breached the contract and we were not obligated to pay any of that but instead we didn't want to we wanted to try and save face and we didn't want to be confrontational but that guy should have got fired and instead he picked our pocket for like another 50 or 60 thousand 000 and that's what happens so never ever be afraid once they don't meet their kpis and they're not honoring their contract don't be afraid to fire them and if you need to get an attorney involved because that'll be cheaper in the long run but the minute that your consultant business coach stops doing their job stop paying them so the last tip that i have is make dang good ensure that if you're sending information to them and you're they're supposed to be helping you coaching you through your financials and stuff like that make sure they're reviewing it and the reason i say this is because the consultant that we hired because he wanted to do the bare minimum we would send him financial statements every month and you know he said oh yeah this month looked like good month and we thought he was reviewing him and doing what he was supposed to be doing come to find out at the end of the year when it was time to renew our line of credit at the bank the bank was a little upset with me because i had taken some draws to fund another enterprise which i was fully in my right to do i could take some draws and so i took a couple draws to fund another enterprise that i had going on and the bank saw those draws on the year in financial statements and said we didn't want you taking any money out now they were way out of line telling me that i couldn't do that we were making good profit there was still plenty of equity in the company we hadn't drained it or bled it dry or anything like that but his buddy because the two were in cahoots the consultant that i had hired was surprised because in 12 months of that happening i took a little bit every month and in 12 months he didn't even realize he was not even looking at the financials in detail enough to realize that there was draws coming out and that is something that's super easy to see on a financial statement which means he was not giving our financial statements any time whatsoever and then he yelled at me and said you know how could you take money out of the company without talking to me about it so that's my company number one i had a right to do that i didn't bleed the company dry but i was telling you every month that i was doing that it was all there in the financial reports you could see that it was your job to review that and if you didn't like it but you're mad at me for not doing your job he was doing such a poor job at even reviewing the financials which was clearly spelled out in our kpis for our contract that he didn't even realize that there was draws being taken out and that should have been a huge red flag and it was right after that we ended up firing him and cutting our contact with him so so those are the seven tips i have for you if you're thinking about getting a business consultant or a financial coach or something of that nature and let me tell you this is one of those things that can cost you thousands and thousands of dollars so be very very careful and take the tips that i've given you to heart because there are bad actors out there that are looking to do nothing but line their own pockets and they're in our industry in our fencing industry they're out there and i'm sure they're in other construction industries so just be very very careful who you get into business with because there's a lot of people that say they want to help you but really what they want to do is help themselves to your money so so i've been involved in three different situations where we hired consultants or coaches and the best one was the first one even though it cost me hundreds over a hundred thousand dollars they they actually did the best job but i would not advise doing that so just please use an abundance of caution if you're thinking about hiring a consultant and always look for a way that's gonna do it better i've talked to some people and one of the people said well you know i just worried that if i went out and i found a mentor that they wouldn't give me any time and i wouldn't get i would be bothering them but if they've signed up to be your mentor they actually care about what you're doing and i talked to a ton of people in our own industry and i'm always willing to share my story and my advice and in fact that's what this entire channel is about is about helping people succeed and so i have the heart of a teacher and i know there's a ton of people in our industry in our fencing industry that they're happy to help out other contractors that are new or struggling but like anything you're going to get out of it what you get into it and i've started some mentoring relationships with other people and they don't put anything into it and i can't do it for them so if you're not going to put the effort into it you're going to get garbage out but at least you didn't pay anything for it a lot of times people will go out and pay a whole bunch for it not put anything into it and then just end up being out all the money and that happens too often so that's that's what i'm trying to warn people against and and would advise you against and if i can help you at all drop me a comment down below if you're looking for somebody i'll do the best i can to answer any comments but please please please look within your own industry or your own business community before you ever consider hiring a business coach so i talked to somebody said you know what if i don't if i don't pay somebody i'll feel like i'm taking up all their time and i'm wasting their time and i won't get what i need to out of it but really in reality the exact opposite happens is because like we talked about these people will sign up multiple multiple more and more people as time goes on and you'll end up paying for it and you'll still get no time from these people and then the only thing you're out is you're hard earned money in the end you're probably going to get more time and better attention out of somebody that's mentoring you out of the goodness of their own heart and because they actually care about your success than somebody that's charging you uh an arm and a leg in a lot of cases and like i say i just there's a psa because i've seen it happen too many times and i feel sorry for these people that get into these agreements and and get no value out of it it really can accelerate your failure if you're coming to these consultants because your business is struggling you could be throwing you could be throwing a log on the fire uh to your to your failure and not really get what you need so there's good people in every industry that's not to say all consultants are bad but unfortunately i feel like there's more bad actors than there are good actors but a lot of people will try and get into consulting not only to line their own pocket but to get other people to pay for their vacations and stuff like that so they'll go for a day and then send you all the bills so watch for that if none of the fees to get to you are ever included and they're supposed to be making trips and you've got to pay a bunch extra money to get them to come to you and actually have face-to-face meetings and go over your financials and stuff that's another red flag i would say your consulting agreement should probably have their travel included in your consulting agreement or it should just be a part of your success there's not a whole lot that can be gained financially from having that person in your office with today's zoom meetings and things like that you can get financials and if the biggest part of your business that you're struggling with is the financial aspect almost all of that can be done off-site without having a whole bunch of travel costs so be leery if somebody wants to come and come and visit you and charge you a bunch of money to fly first class and stay in fancy hotels and and spend a day visiting with you one of the last meetings that i had with our consultant he he our consultant down there in fort collins really irritated me it was a big deal i needed to get to him he wasn't going to come to me and like say in the two years that we had him and despite both of our agreements saying that he was going to come to us six times a year he never came once he only sorry he only came one time the last meeting that i had he made it seem very important and i need to get down there and come see him and so i went down there and i came and saw him and i was like we need this needs to be a substance and i sat in his office we didn't even look at my financials we didn't do anything took us a whole whopping 45 minutes before he ran out of time and needed to go do something else and i had just driven eight hours to come see him one way and so then it was eight hours back so i spent 16 hours to go visit him for 45 minutes and we could have done it on a phone conversation or a zoo meeting so be leery if anybody wants to charge you a bunch of money to come visit you at your place or want you to come visit them and pay all those expenses because most of the business coaching and consulting is financial in nature and can be done remotely so so that's bonus tip number eight and that's really all i'll say about that now i think i'm good and until next time you have a good dang day and stay away from consultants if you can you

2021-06-06 21:23

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