#48 – The Keys To The Financial Statement

by | Jun 27, 2017

One of the most important things for a leader to be able to move up the ladder is to understand FINANCIALS”.

On this week’s show, Chris “The Bulldog” Collins and co-host Gary “G-MAN” Daniel discuss the keys to understanding the financial statement and how in just simply understanding the financial statement correctly can dramatically increase profits and create effective workflow systems.

Before the main topic of the week, Chris wants to discuss Gary’s new hobby…long-boarding. As it turns out it’s not just any longboard, “but the Ferrari of longboards” with a wireless remote triggered engine. Gary’s relives a dramatic story/situation that happened on the Venice Beach boardwalk the other week. Following this Chris wants to have the “mid-life crisis conversation”. As Chris asks what Gary will purchase for next car, they discuss classic cars and some of their own car history including the cars on their dream list.

The experts of the Service Drive then move onto the main topic of the week – financials. Chris opens up the topic talking about how managers aren’t paying enough attention to the financial statement and focusing too much on gross. Chris and Gary break down what you need to be looking at when you’re going through and working with financials – profit is the bottom line, “we’re in the business of making money”.

Gary reminds Chris of when he taught him how to understand financials many years ago, using a pen and pencil instead of Excel spreadsheets. Both Gary and Chris discuss how difficult it was and how it made them feel almost stupid “it took me until the 5th or 6th time to get it”. But it’s just repetition and learning how to work and understand it, as Chris states “it’s a living and breathing thing… you don’t have to be a maths whizz…you just need to learn it”. Understanding expenses, net income, gross income, effective labor rate, the gross profit percentage, and realizing how your financial metrics function helps create CLARITY in the business as it touches so many various components, resulting in better systems and the tools to scale and grow your SERVICE DRIVE.