Episode 192 Frederick Dudek (Freddy D)

Financial Clarity for Service Businesses can unlock hidden profit, eliminate cash stress, and turn your numbers into a strategic scoreboard for predictable growth.

Financial clarity is the difference between scaling profit and scaling stress—and in Episode 192, Jon Morris, Founder & CEO of Fiscal Advocate, reveals how service-based businesses can engineer a $3M financial turnaround in 6 months.

Too many founders grow revenue while flying blind on profit margin, cash flow, and real KPIs. The result? Burnout, cash distress, and stalled growth.

Jon shares how he scaled Rise Interactive to nearly $40M before exiting—and how that experience led him to build Engine BI and an AI CFO co-pilot to help leaders make smarter financial decisions.

From fixing broken chart of accounts to identifying bloated finance teams and leaking margins, this episode shows how financial clarity transforms stress into strategy—and chaos into confidence.

Discover more with our detailed show notes and exclusive content by visiting: https://linkly.link/2byDK

Key Takeaways

• The 3 KPI Scoreboard: Cash-to-overhead ratio, profit margin, and year-over-year revenue growth determine whether you’re building wealth or bleeding cash.

• Income Statement as a Storyteller: When organized correctly, your P&L reveals exactly where growth is stalling—and why.

• Benchmarking Creates Competitive Edge: If the industry average is 8% sales & marketing spend, playing at 16% can create growth acceleration.

• First 100 Days Matter Most: Product-led onboarding builds a “goodwill bucket” that protects long-term retention and referrals.

• Accountability Drives Revenue: Sales teams without quotas and pipeline visibility kill growth momentum.

• Small Pricing Tweaks, Massive Impact: A simple $5 increase flipped one business from negative net income to profitability.

• Urgency Wins: Waiting four months after losing a major client is fatal. Financial clarity demands decisive action.

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Guest Bio:

Jon Morris is the Founder & CEO of Fiscal Advocate and former Founder of Rise Interactive, a digital agency he scaled from $10K in prize money to nearly $40M in revenue before a successful exit. Today, Jon helps service-based CEOs eliminate financial blind spots through Engine BI and AI-powered CFO tools—driving profitability, clarity, and scalable growth.

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Freddy D’s Take

Jon Morris doesn’t just talk theory—he delivers championship-level financial execution. He took one service firm from losing $1.5M to generating $1.5M profit in a year. That’s a $3M swing. That’s not luck—that’s financial clarity.

Here’s the game-changing insight: Most service businesses don’t fail from lack of effort. They fail from lack of financial organization and accountability.

Jon breaks it down like a coach reviewing film:

1. Sales & marketing spend misaligned
2. Bloated finance teams
3. Freelancers killing margin mid-month
4. No quota accountability
5. Disorganized chart of accounts

This is exactly the type of strategic shift I help clients implement through my SUPERFANS Framework™ inside Prosperity Pathway coaching within the Entrepreneur Prosperity Hub.

When your numbers align, your team aligns. When your team aligns, your ecosystem becomes advocates. And when your ecosystem becomes advocates—you build momentum that compounds like a championship dynasty.

Growth Breakthrough Call

The Action:

The Action: Audit your Sales & Marketing spend percentage.

Who: CEO or Founder

Why: If you don’t intentionally fund growth, you’re relying on hope instead of strategy. Financial clarity demands intentional allocation.

How:

1. Calculate S&M as % of revenue
2. Benchmark against industry averages
3. Evaluate ROI by channel
4. Set a 90-day measurable growth target
5. Adjust budget to match desired outcome

Predictable Growth Mentoring

Guest Contact

Connect with Jon Morris:

Website: FiscalAdvocate.com

LinkedIn: Jon Morris

LinkedIn Client Pipeline

Resources & Tools

• Engine BI – Budgeting, forecasting, benchmarking platform for service firms

• Luco (AI CFO Co-Pilot) – AI-powered financial decision assistant

• Fiscal Advocate eBook – Budgeting & forecasting guide

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Companies mentioned in this episode:

1. Fiscal Advocate Inc.
2. Rise Interactive

Copyright 2025 Prosperous Ventures, LLC

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Jon Morris: 00:00:00

If you know how to organize and read an income statement, it's a great storyteller.

Intro: 00:00:06

But I am the world's biggest super fan. You're like a super fan. Welcome to the Business Superfans Podcast.

We will discuss how establishing business Superfans from customers, employees and business partners can elevate your success exponentially. Learn why these advocates are a key factor to achieving excellence in the world of commerce.

This is the Business Superfans Podcast with your host, Freddie.

Freddy D: 00:00:32

Freddy

Jon Morris: 00:00:33

Freddy

Freddy D: 00:00:46

Hey Superfans. Freddie D. Here in this episode 192, we're joined by John Morris, founder and CEO of Fiscal Advocate Inc.

He tackles a challenge that quietly limits so many professional service firms. A lack of real financial clarity.

Too many CEOs are growing revenue but flying blindly on profitability, cash flow and the numbers that actually drive smart decisions. John's Journey started with 10k in prize money from the University of Chicago's New Venture Challenge, which he turned into Rise Interactive.

Scaling it in over 16 years into nearly 40 million digital agent scaling it over 16 years into a nearly 40 million digital agency before a successful exit.

After experiencing the financial blind spots firsthand, he built Fiscal Advocate to give service based leaders the insight and confidence to grow profitably. If you ever felt unsure about your numbers, this conversation will show you a smarter path this conversation will show you a smarter path forward.

Jon Morris: 00:01:57

Foreign

Freddy D: 00:02:01

to the Business Superfans Advantage podcast. Great conversation that we had before we started recording both a couple of Chicago dudes. You're still one.

I've migrated over to Arizona, which is where it seems like a lot of Chicagoans end up. Great to have you on the show.

Jon Morris: 00:02:17

If you had a camera and turned it around, you would see all the snow that you are missing out on.

Freddy D: 00:02:21

Good.

Jon Morris: 00:02:22

Now anything? It's not your area.

Freddy D: 00:02:24

icago back in, I think it was: 2010

I've got pictures of that because I actually went out there to take photos and it was looked like an apocalypse of a bunch of abandoned cars, all snow covered, city bus there. It was crazy.

Jon Morris: 00:02:51

We've had more snow. Like we actually broke a record for the most snow in one day in November in the history of Chicago.

e had more snow since the big: 1978

Freddy D: 00:03:06

Wow. Good. It's good and bad. We need the weather. We've actually had here a lot of rain, which is surprising for Arizona Yeah.

So let's go back to the beginning. I know that you guys, you started an agency that you're helping people with their accounting, finances, business planning and all that stuff.

But how did that all come about? What's the backstory?

Jon Morris: 00:03:29

ually a digital marketer from: 1996

ion revenue. And I sold it in: 2020

That gave us an edge. If you know how to organize and read an income statement, it's a great storyteller.

I know it sounds strange, but that was the foundation to how we did our business and made our decisions. And so when I exited, that would be really fun. I love connecting with other entrepreneurs. I love helping people.

And I thought that this was a way that I could give back and ideally help make other people's entrepreneurial dreams come true.

Freddy D: 00:04:29

You bring up an interesting point because you're right. The P and L statement is really a roadmap that gives you the ability to see what is happening within the company.

And a lot of times you can find deficiencies within the organization based upon the financials.

Jon Morris: 00:04:47

Not only just inefficiencies, but you can also find what's important to them. People come to me all the time and say they want to grow faster, and I always follow that up with a simple question. Awesome.

What percent of your revenue do you spend on sales and marketing? And oftentimes the answer I get is zero. And so my response is it's all word of mouth and all referral.

And you don't spend any money on sales and marketing. You don't really want to grow.

You might wish that growth happens, but if you want to make growth happen, then you got to spend money on sales and marketing. I'm the opposite. I spend like constantly thinking of how do I spend more in innovation and more on sales and marketing.

Those are the two major drivers to fuel growth of a business.

And so if you see those numbers in your income statement, you can instantly determine if you're poised for growth or are you poised to maintain where you're at?

Freddy D: 00:05:47

Yeah, you bring up a good point.

Because when I was selling technology back in the early, actually late 80s, we would do marketing and I was basically running the Chicago office and I was like, here's a brochure. You've got Illinois, you've got Missouri, you've got Indiana, and go sell. And your sales quota is. Yes. And so I had to come up with my own marketing.

And so what we did back then was we did lunch and learns and invited VPs of engineering, VPs of manufacturing, because I was in the computer aided design and manufacturing space and it was a lunch and learn of how the technology was changing for that market space. And so that was our marketing approach. And that's how I get people in for a lunch and learn.

And then basically they would invite me back to their place and says, we would love to because we weren't selling in the presentation. It was an educational.

And then so they would invite me back in and say to come in your office and take a look at their operation and let them know how this might help them compete with everybody else. It was like inviting the fox into the hack because once I was in, the deal was done. So you're absolutely right.

You need to do some level of marketing and invest in sales and sales training.

Freddy D: 00:07:13

Yeah.

Jon Morris: 00:07:13

basically think of it as like: 2026

You're going to win new customers, you're going to retain your customers, or you're going to upsell your customers. It's really the only three drivers. So when it comes to winning new customers, there's two avenues. There's sales and there's marketing.

And I want you to figure out, how much revenue do you want? I want you to break it out by month and be like, I need to win this many clients every single. This is what it costs to acquire a customer.

I'm going to do lunch and learns, or I'm going to go sponsor events, or I'm going to go spend money on media, or I'm going to go hire a channel marketing partner. You got to think about how you're going to get those numbers, and then you got to go execute flawlessly.

And by the way, everyone's going to make mistakes. Like you're going to go hire a bad salesperson, you're going to sponsor at a wrong event. You're going to try a strategy that's a complete failure.

But as long as you optimize and keep on learning, that's how you build a system that creates a flywheel where you keep on growing.

Freddy D: 00:08:20

Oh, absolutely.

And then the part that really, you know, one of the things I've said because I've been in sales forever is the sale really begins after the paperwork. The paperwork is just a transaction part.

Jon Morris: 00:08:32

Yeah.

Freddy D: 00:08:32

In my mind the sale is the onboarding of the customer, the relationship.

Whether you're selling a technology product, a service or whatever it is, it's that whole experience that customer is experiencing and after they signed the paperwork because you can have the greatest sales guy in there and if your whole onboarding does a face plan, it doesn't matter, you're over.

Jon Morris: 00:08:54

Couldn't agree with you more. One of the expressions you'll hear me say often is that your number one sales goal is never lose a client due to performance.

Takes a lot of work to win a client and earn their trust. And if you think of the salesperson as the promise maker, someone who's doing that delivery is the promise keeper.

And you want to make sure that the experience is better than what you sold. That's why I mentioned innovation. Investing in R and D is because I constantly want our product to evolve.

I want people to be like, wow, what an amazing company to work with.

Freddy D: 00:09:29

It's important because one of the things is important in the implementation of if you're bringing technology and you guys have a software product that helps people, especially in the service based businesses. But that whole implementation aspect of it is the game changer because the reality is people are going to run two systems.

They got to run their existing system because they can't just switch over to the new stuff. They're going to have to run their existing stuff simultaneously as they're ramping up on a new technology.

And so you've got to position that whole company, their mindset to understand that that's what's going to happen. Because a lot of salespeople sell the stuff but they don't tell what's going to actually be happening.

Jon Morris: 00:10:15

Yeah.

Freddy D: 00:10:15

And if you set up the right expectations, then all of a sudden the onboarding and everything else goes smoothly.

And more importantly, the team internally become what I would call super fans of you because you took the spotlight off of them because you bought them some road to learn the new technology versus being. We bought this stuff, John. How come we're not making money with this?

Jon Morris: 00:10:39

Yeah.

There's a great book called product led onboarding and it basically says that if you win a client and you think about keeping that client for a full year, there's the first hundred days, there's the last 100 days and the 165 in the middle. And what it explains is the most important Time period is that first 100 days. And if you can make that flawless, you build a goodwill bucket.

And because we're human, we're going to make mistakes. But if you screw up in the beginning, your goodwill bucket's on zero. And so when you make a mistake, you have no margin for error.

That's when you end up losing the client. The other thing I talked about is the moment the value is realized and the moment the value is actualized.

So the moment the value is realized is when the client is. I get it. I now understand why I hire these people.

And the moment the value is actualized is where they got the return off of what they're looking for.

And what you want in that first 100 days is move everything over to the left so that they can get the value realized and the value actualized as fast as possible. And so I couldn't agree more with what you're saying here.

Freddy D: 00:11:48

Yeah, and that's one of my successes was that I did that, I set up their expectations and I would turn around and said and set what's the objective? What's the long term plan? And it was like, when do you want to be making money with this?

Jon Morris: 00:12:01

Yeah.

Freddy D: 00:12:01

Because you're investing let's say $100,000 in the technology back then and it'd be like, okay, I'd want to make it as fast as possible. Okay. Yeah, I know, we all know that. Yeah, let's look at realistic. And we would lay out the timeline and then all of a.

And then we would work the sale backwards. And that was one of my approaches is I turn around, says John.

Okay, you realistically, it's going to be 18 months before you can start seeing some money back on this. We would work it all the whole steps back. And then the fun part was based upon the timeline that we just laid out. You need to issue me a P.O.

right now.

Jon Morris: 00:12:35

Yeah.

Freddy D: 00:12:36

Because this is your timeline that you just laid and boom, the sale was done because they emotionally created it themselves the whole time.

Jon Morris: 00:12:44

Yeah, sounds great.

Freddy D: 00:12:47

So let's talk a little bit about

Freddy D: 00:12:48

your platform, what it is and how does it work and how does that really is a game changer for business.

Jon Morris: 00:12:53

So I mentioned we are able to grow rise through better decision making. And I also talked about how the income statement tells a story.

So what I built is Engine BI is a budgeting and forecasting, benchmarking and business intelligent tool mainly for professional service companies. And we have a new product coming out called luca, which is an AI CFO co pilot.

And the Most important thing thing is I want to help people make the right decisions and it focuses your time and energy on the things that matter. So first of all, there are only three KPIs.

I care about how much cash you have relative to your monthly overhead, your profit margin and your year over year revenue growth. So if you just improve those three numbers, you as a CEO or you as a founder are going to achieve all your dreams.

So there's only three numbers that you need to improve. Now granted, if it was that easy, it'd be like, oh, I just increase this number and I'd be done.

But then I mentioned to increase revenue, there's only three numbers there, upsells, new business and renewals. And so the idea is that the tools help you understand what decisions you need to make. Gave you the example before sales and marketing.

If growth is important to you, then you need to reduce your churn, you need to increase your upsells and you need to increase new business. That's only going to happen by budgeting for it.

We talked about change management and if you have a new technology that you got to get people embraced with that new technology. Same thing. If you want to change your outcome, you got to change the math.

So if you want to increase your new business, I want to see what percent of revenue are you spending on sales and marketing? Is that percentage going up on a year over year basis? Then I want to make sure that you're actually spending the money intelligently.

We'll get further and further into the analysis. So that's the general idea of what the tool does and what we're building.

Freddy D: 00:14:57

That sounds quite interesting because I worked with a language services company a couple years ago and they had been in business for 30 some years and they were between $901.1 million on and off.

I work with the business coach that they had and then when I stepped in, him and I worked together and every time we would meet he would be banging on the P and L statement because it never made sense to him.

And so that's really an important aspect is first off, you've got to get all your chart of accounts organized properly because garbage in is garbage out.

Jon Morris: 00:15:38

Yep. And I like to equate it to like going to a hardware store and looking to buy.

It was just say some type of screw or bolt and imagine it was in a massive bin and it was just like every size was just mixed in there. You're never going to be able to find what you're looking for. It's like trying to find a needle in a haystack. Your income statement is the same way.

majority ownership of rise in: 2018

I didn't have a choice. David Zwader came to work for me as part of the deal. David was amazing, absolutely brilliant. And he gave me a report early on in.

I'm really good with numbers. And I'm looking at the report and you can see that I'm churning and I'm doing math in my head. And his response was, john, just stop.

And I was like, why? And he goes, I've already failed you. I was like, what do you mean if you have to do math in your head? I didn't give you the right report.

Tell me what you were working on. Tell me what you were trying to figure out. Next time I give you the report, it will be formatted exactly like that.

And it's not that many things that you need to look at. There's literally five things that you need to look at at a high level. What percent of your revenue do you spend to deliver for your customers?

What percent do you spend in your back office? What percent do you spend in sales and marketing? What percent do you spend on your executive team? What percent do you spend on R&D?

And what percent is your profits all based on? Percent of revenue. Those are the six things you need to look at. And if you know those numbers, you can make really intelligent decisions.

But it's exactly what you said, Freddie is. You got to organize the chart of accounts so that you're not doing math in your head. So I think there's two critical pieces.

The first one is, do you know the right question to ask? The second one is, once you see this information, do you know what to do with it?

So if I tell you that we spend 6% of our revenue on sales and marketing, the question is, if is that good or is that bad? In my opinion, it's bad. And I'll tell you why. Because the average for professional service companies is 8%.

I want a competitive advantage when it comes to spending sales and marketing as a percent of revenue. I want to be, like, at 16%. And so I got to figure out, what am I not investing in so that I can spend more in that Area.

Same thing with R and D. I want to have the biggest R and D budget relative to my company size. So as I grow, I want the percentages to stay or even grow from there.

Freddy D: 00:18:25

Yeah, no, you bring up some really important points.

And that's one of the things that I used to do with this business coach is we would look at it and then we ended up bringing in a forensic CFO to fix the whole chart of accounts and the bookkeeping because they had to go back several years because this was a husband and wife team that basically had their cars and some loans in there and everything else. And it never gave us the right numbers. It never gave us the accuracy. Once we had it all cleared up, then I made a minor tweak and I just increased.

We were selling hourly services. I just did a $5 increase, which is a small amount of number. And I basically only got one customer to push back down it.

And they go, hey, the invoice is different. What changes? We've made a $5 increase. We haven't increased stuff in years. And he says, oh, that makes sense. It's only. That's fine. And.

But that 5,000 to a big number made a huge number difference to the bottom line. We completely change it from a negative net income to a positive net income.

Jon Morris: 00:20:52

We have built into all of our contracts that on the 12 month renewal, the rates automatically go up 5% every year and a couple people push back on it. But I just explained, I was like, look, we live in inflationary times. I have to give my employees raises every year.

Every year I give a cost of living adjustment. And so I can't just continue to get my margin squeezed. Everyone says that makes sense. I totally understand. They don't like it, but they agree.

Freddy D: 00:21:19

Yeah, I did the same thing. It's funny you bring that up. I did a 3% over for three years and I sold into hospitals, a pretty large hospital.

And there was a little pushback at first, but then it was like, it does make sense. It was 3% is the average inflation rate at the time. And they agreed. So you're absolutely right.

So talk about a little story of how you walked into a company that was, they were doing okay, but you guys really stepped in and completely changed the dynamics of that company.

And they're now one of your biggest brand advocates, or what as I prefer calling as a business superfan, promoting you to others and getting you more business.

Jon Morris: 00:22:00

Yeah, a couple of things. I oftentimes deal with two types of businesses.

Cash, distressed businesses and companies that hit Some type of plateau where they just can't grow anymore. And as I said, the income statement tells a story. I can generally tell you exactly why.

So last year I had a client that was doing about 10 million, 11 million in revenue. They were losing $1.5 million. They had a very expensive CFO, they had a massive finance team.

And to give you an idea, because I only work with the same types of businesses, I work with service based companies, I was able to benchmark how much they were spending on their finance team relative to every single company that I dealt with. And it was based on size. However you want to look at it, no one was even close to spending as much money on their finance team.

So if you think you're spending that much money, the finance team, you better be profitable. Right? Like you should have. You should be making a ton of money. As I mentioned, I know all the benchmark numbers.

I know what percent they should spend in terms of delivering for their customers. I know how much they should spend in their back office.

And so working with the CEO, it took about six months, but we took them from losing a million and a half last year to making a million and a half this year is a $3 million swing.

Freddy D: 00:23:23

Well, that's a huge turnaround. Not only a three million dollar increase.

Jon Morris: 00:23:27

Yeah, not only does it has a turnaround, I love these people. They're just great, high quality individuals. The amount of stress they had last year was just so unnecessary.

And they're not only sleeping well at night, they're excited now. They're now talking about the investments they're going to make and how they're going to grow.

So it went from I'm tapping out my line of credit and I might have to put more money into this and I don't know how to turn this around to I want to go invest in AI and I want to go and increase my sales and marketing investment. Our whole conversation has changed within a very short period of time.

Freddy D: 00:24:10

Definitely they're super fancy. You turn that into a $3 million positive because it took a million and a half to get to zero.

Jon Morris: 00:24:17

Another good story is we want a client in April of this year. Very similar. Losing money, not knowing why, and we just got them to break even in October. I finally figured out what the problem was.

So they would forecast what their margin was going to be and then every month they would miss it. And they gave everyone in the client service team freedom to go hire freelancers to go do the work.

And so what they'd end up doing is Hiring a bunch of freelancers in the middle of the month and just kill all their profits for the month. And they're just doing this repeatedly over and over again.

So we developed a system of approval processes, and you got to look at your resource planning, your capacity analysis, and they're not allowed to just go hire freelancers for the sake of hiring freelancers. So they broke even in October, and they're going to be fairly substantially profitable in the month of November.

And so, once again, it took about six months to get them to this point, but I expect them to be in profitability and perpetuity. The guy owns a second business. He's already talking about bringing us on for that second business. And so it's another super fan that we created.

Freddy D: 00:25:31

I want to really emphasize, because that's roughly about the time it took us to turn around that language services company was about six months to get the books cleaned up.

Jon Morris: 00:25:42

Exactly.

Freddy D: 00:25:43

To get everything organized and figure out where the leaks were and then putting in the systems in place.

y almost a million dollars in: 2023

Jon Morris: 00:26:00

That's awesome.

Freddy D: 00:26:01

And for that type of a business that was doing about a million big, big deals, almost 100% increase, a huge deal like that, we did exactly.

What you're talking about is we fixed the books and then we looked what was leaking, and then we made the tweaks and got everybody, more importantly, got everybody aligned with the mission of the company. Like a racing rowboat that you see on the Lake Lincoln park there, those people racing on those rowboats, getting everybody in line, in sync.

That's what we did.

Jon Morris: 00:26:29

I'm the messenger. I'm telling you what decisions you need to make. What I'm also trying to do is create a sense of urgency to make them.

But at the end of the day, I can't make the decisions. I'm not the CEO. I don't have the ability to change the cost structure. And I'm going to give you a good example.

I have a new client just started, and another cash distressed company. They were losing money all year round, but come August, they had a massive cliff where they lost a huge client.

And so now they're even in worse shape. They've actually increased their expenses between August and December. And I talked to the CEO on Tuesday, so just two days ago, and basically said.

I was like, look, you have to cut $45,000 a month out of your Expenses and I want you to do within four days. And I don't want you to be stupid and make the wrong cuts. But I was like, go clear your calendar. We can't have you lose money anymore. You gotta.

We don't want you to be a not for profit. We want you to be a for profit. And so coming with that sense of urgency is really important.

Now, if it takes them two weeks, three weeks, that's fine. But I'm trying to change the. I lost a client in August and it's four months later and we haven't changed a single thing yet.

I don't know what will happen. I hope that he follows my advice and makes the changes. But that's the one big thing I've learned about this business is it's a partnership.

Like, I'll help you understand what decisions you need to make. You need to be able to make the tough decisions.

Freddy D: 00:28:07

Yeah. And sometimes it's quite difficult to get that person to change because change is the biggest obstacle.

In my case, I'll just use a simple, funny example is my now wife. I moved back to Michigan for a little while, which is where I grew up. And I met her and I wanted to come back to Arizona. And she's.

I'm not going here. Just met you. And so it took five years for us to make the change. And change is very difficult, but sometimes you got to make it.

Now that we've done it, here she goes, all right. We should have moved here much sooner. But it is what it is.

And so I think that what you're doing is you're helping them visualize what they need to do and the outcome, but they've got to pull the trigger.

Jon Morris: 00:28:53

Yep.

Freddy D: 00:28:54

So let's get into a little bit more about the software product, the one that you've got really right now and the one that you're coming out with. Let's do a little deeper, dive into that.

Jon Morris: 00:29:04

Yeah. So you talked about the chart of accounts. So we had at rise a Google sheet on steroids. And that's how I ran my business. I logged in every single day.

I used it every single day. And so Engine BI is just a productized version of that. It's how I do my budgeting, it's how I do my forecasting, it's how I do my decision making.

I log in my whole company, we log in about 300 times a month. By the way, I have a client of mine. You talk about superfans, they log in 550 times a month. So they're living and breathing.

And what it does is organizes your data in the most granular way possible so that really the key questions you can ask, you'll be asked. I'll give you a good example. Client of mine is spending $400,000 on sales and marketing, and it's not working. It's not effective.

And when you look at it, you're spending 250,000 of the 400,000 on a chief marketing officer. And the problem with that is they're just not spending enough money on marketing to justify that senior of a person.

If they had a $2 million budget, I could get my arms around it. But they have a $400,000 budget. Like, they need a marketing manager at around 75,000 a year to spend more on the other aspects of marketing.

So by having that granular detail, you're able to answer like critical questions. What percent am I spending my sales and marketing? How effective is my sales and marketing? If not effective, what are the reasons?

And so it really gets into very granular data that allows you, from a budgeting and a forecasting standpoint, make decisions about what you should do to help scale and grow your business.

Freddy D: 00:30:54

Yeah, it was very important. Brought on a sales guy at this language services company and he was talking a great story.

But I started looking at the numbers and looking at everything else within the P and L statement and what was happening. And it turns out it was a lot of stories and not a lot of real action.

Jon Morris: 00:31:12

Yeah.

Freddy D: 00:31:13

So the numbers were able to help me identify that person was not doing what they were supposed to be doing.

Jon Morris: 00:31:20

I'll give you another example. Very similar. I do a lot of advisory work as well. So one of the things I'm doing is helping people.

One of my clients with their go to market strategy and their sales team. And they've been flat for the last few years and they can't seem to figure out what they need to do to grow.

And they're spending money on sales and marketing. What they have is zero accountability to the team. And they're telling me about this one person who in the last 18 months has won two clients.

And I'm like, why are they still there? And I was like, they do some things well and they did this. They put their time and energy into it.

And I'm like, look, here's how much revenue we need in January. And this is their person's quota. Now. They didn't have a quota for the individual. And I want you to look at your pipeline.

I was like, do they have a path to making January. Can they make just in a few weeks their January quota? Can they make their February quota? What activity are they doing?

Are you pleased with that activity? And if not, you need to get rid of the person and get a new person in.

And I'm trying to create a sense of accountability where everyone understands what they're doing, that they're performing well, that they're going to meet the metrics that they're looking for. And I believe wholeheartedly that one, spending the money two is making sure that every dollar counts right.

And that you have the right team that could execute on that work.

Freddy D: 00:32:48

Yeah, you bring up a great point because I always had a rule that you need to have three times what you anticipate selling.

Jon Morris: 00:32:57

Yeah.

Freddy D: 00:32:58

Because a third will buy, a third won't buy and a third you'll lose.

Jon Morris: 00:33:04

Yeah.

Freddy D: 00:33:05

So to get your numbers, you gotta have 3 times 3x what your potential 3 acts. Because like I said, a group will some won't and you'll lose some. And that's just the way it is.

Jon Morris: 00:33:19

I love it.

Freddy D: 00:33:21

So you bring up a really great point there. And that's a lot of times, unfortunately, businesses just wing it. They get going, they get successful.

At some point they got some money coming in and then it gets to the point where they don't have their own skill sets. Holds them back because they don't know what they don't know.

Jon Morris: 00:33:43

I always tell people everyone has a strategic plan, whether they know it or not. It's what you spend your time and money on. You know, you're not spending any time on sales. You're probably not going to do very well.

If you're spending time on deals that are too small, you're probably not going to win the big deal. So it's what's important to you is how you spend the time.

Freddy D: 00:34:02

Yep. And the other thing too is that we go back to the customer engagement.

I think it's really important, and I like to throw in that there's a fourth component in there and that's the getting the customer to becoming your sales agent.

Jon Morris: 00:34:17

Yeah.

Freddy D: 00:34:18

Because if you do a good job of getting them to where they want to go with their business, they're going to be happy to tell all their friends. They're actually going to want to tell all their friends because everybody knows at least 250 people.

And now all of a sudden you're not getting referrals, you're getting introductions that says, you need to talk to my friend John because this is what he did for me. And I think you need to talk to him because he can help you. And that collapses that whole sales cycle because they're no longer shopping.

They're saying, dave says, I need to talk to you, John. So here I am. Let's talk. And you can't kid better sales.

Jon Morris: 00:34:58

You absolutely can. And part of it is not just delivering the results, but really caring. I deeply care about my customers, worry about them. I think about them.

I love it when they succeed. Just the other day, one of my clients had his second baby.

And from the hospital room, he's sending me text pictures, text messages of a picture of his baby, which just one. So happy for them. But it also meant so much to me that I was important enough that I made that list.

And that's what I strive to do, is make sure that I built deep friendships and that these people know I care and that I have their back. And then I'm going that extra mile for them. And I think that people know that that goes a long way.

Freddy D: 00:35:42

And that's how you create superfans. Because now you've transcend into a friendship.

Yeah, it's like when I was managing resellers around the world, I would be invited when I would fly into, let's say, Norway, the reseller there invited me to his house, and I stayed in his house, cooked dinner and everything else for me because of the level of friendship that we created. And I still have friends around the world from those days because of exactly what you just said is helping them get to their goals.

And at the same time, sometimes you gotta stop talking about business and actually talk about life.

Jon Morris: 00:36:22

I completely agree.

Freddy D: 00:36:23

As we come to the end here,

Jon Morris: 00:36:25

John, how can people find you three different ways? So the first is I post minimum of three times a week, every week on LinkedIn. So you can go follow me on LinkedIn.

The second is if you go to fiscal advocate.com in the resources section, you can download my ebook. It gives you my whole approach to budgeting and forecasting and how you can use these financial decisions or financial data to make better decisions.

And then just email me joniscal advocate.com

Freddy D: 00:36:51

we'll make sure that's in the show. Notes. Thank you so much for your time. Great conversation.

Definitely love to have you on the show down the road because you and I could probably talk about this for at least a couple of days.

Jon Morris: 00:37:02

Absolutely. Love it. I really appreciate it.

Freddy D: 00:37:05

All right, thank you.

Freddy D: 00:37:06

What a powerful reminder from John. In this conversation, growth isn't just about chasing revenue. It's about understanding your numbers. Deeply enough to make smart, confident decisions.

Your income statement isn't just a report, it's a story. And if you don't know how to read that story, you could be scaling. And if you don't know how to read that story, you could be scaling.

Stress instead of Profit John showed us that service based business don't fail from lack of effort, they struggle from lack of clarity. When you know your margins, your cash position and where every percentage of revenue is coming from, you stop guessing and you start leading.

That's the difference between reacting to problems and proactively building a business that runs smoothly, predictably and profitably. If this episode brought you value, leave a quick 5 star review.

It helps other service based business owners discover the show Join the Entrepreneur Prosperity Network if today's conversation got you thinking about where your business could be not just this year, but three years from now, don't let it stop here.

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We've got another great guest coming up and I'll talk to you in the next episode. Remember, one action, one stakeholder, one Superfan Closer to Lasting Prosperity we hope you

Intro: 00:39:35

took away some useful knowledge from today's episode of the Business Superfans podcast. Join us on the next episode as we continue guiding you on your journey to achieve flourishing success in business.