Mike "Cash Flow Mike" Milan of Truly Financial joins Accounting Insiders to chat about his beginnings as a business owner, how not to be a D.U.M.B business owner, and how Truly Financial can improve your business.
Mike "Cash Flow Mike" Milan of Truly Financial joins Accounting Insiders to chat about his beginnings as a business owner, how not to be a D.U.M.B business owner, and how Truly Financial can improve your business.
Live from Scaling New Heights, Mike dives deep into what mismatched financing really is, how Truly Financial can benefit your business, and shares the "5 Silent Cash Killers" that are interrupting the cash flow into your business.
Listen now to learn more about Truly financial, and how improving your cash flow is easier than you think.
Learn more about Truly Financial: https://trulyfinancial.com/
Learn more about Mike: https://cashflowmike.com/
Mike's Books:
The 7 Minute Conversation : The Way You Should Be Thinking: https://www.amazon.com/Minute-Conversation-Should-Thinking-Business/dp/1950088952
Don’t be a D.U.M.B. Business Owner : (Don't Understand My Business) : https://www.amazon.com/gp/product/B08GV2XLGN/ref=dbs_a_def_rwt_bibl_vppi_i1
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Gary DeHart 0:09
So thanks for joining us for another episode of insightful accountants accounting insiders. I'm Gary Hart publisher of insightful accountant am joined by cash flow Mike you may know him as Mike Milan he's with Truly financial and it is Milan?
Mike Milan 0:29
It's actullay Milan. Gary There's a song I teach all my friends a song. You already know it. Right? This land is your land by land. We go. Hey, go now you should always know it.
Gary DeHart 0:29
Yes, I got you covered. It's like, you know, I miss cashflow month and that's it. It's in his book. And his book is the seven minute conversation actually has two books, seven minute conversation and don't be a dumb business owner. So we're going to talk primarily about seven minute conversation. But before we dive into that always have a trick question. Not really a trick question but a fun question. Who is your favorite cartoon character?
Mike Milan 1:06
See now even give me his star and I still gotta think about it. You know what I think is Mighty Mouse Mighty Mouse. Think about it. That's the one nobody really goes to the real to him. It's kind of underwhelming a little bit. He's just a mouse. Right? But the song sticks in my head. He's mighty.
Gary DeHart 1:22
I don't remember the song.
Mike Milan 1:24
Here I come to save the day!
Gary DeHart 1:30
Oh, that was him? Mine's Bugs Bunny, then last week, it was somebody last week I can't remember who it was pulled out Speedy Gonzalez. Like some Speedy Gonzalez source. All right. I'm not sure what that has to do seven minutes. So we're gonna end this. So it doesn't become a 30 minute conversation about Mighty Mouse. But tell us a little bit about yourself. Because in your book talking about your state trooper, state trooper and a few other agenda up here in the wonderful land of accounting technology.
Unknown Speaker 2:01
I've got to tell you that I've had people ask me to say how do I get to be what you're doing? Like, you can't get there from here. Again, you start off as a state trooper, my, my family outgrew my income. So I had to go use this thing called an MBA. Right? Right in a student loan check. Am I going to probably use that? Yeah, maybe? Yeah. So I started a business. And over the last 25 years, I've built 14 companies. And that's just kind of how it evolved. I think once they become something, I think most people flip properties, I started flipping companies. That's kind of what happened.
Gary DeHart 2:33
And that's what you do best, right. And that's your course, what you like to do is kind of start up, get running and everything and then move on. And...
Mike Milan 2:40
As soon as they put rules in, and then I have to go.
Gary DeHart 2:44
So what like what's the range of businesses like what types?
Mike Milan 2:46
I started out with a janitorial company. And that actually morphed into a hotel staffing company. Whereas I had more clients that just wanted people and less to do the work. They had their own management staff, but they were having trouble finding housekeepers or people to wash dishes in the kitchen or do landscaping or just tasks that people have to do. So I became a staffing company. And I opened 27 offices and nine states in about three years, had about 500 people working I was a preferred vendor for Marriott. So that's kind of how it just really grew. Like when you become a preferred vendor, people just call you right? And you're like, hey, we're in Tucson, we'd like to into somebody, of course. So we grew that way. And then I ran into a receivables problem. Right. So all of this cashflow, Mike started with that hotel staffing company. Whereas, you know, every two weeks, I had to make payroll. Sure to get paid, they'd have to get paid. Guess what Marriott doesn't like to pay as fast as I have to pay?
Gary DeHart 3:48
They might be the first ones in line?
Unknown Speaker 3:50
Well, it was an interesting thing, right? Because my payable days it would take them between 60 and 75 days on average to pay an invoice. Well, you know, every 14 days for me is making a payroll payment. So I went to, you know, I went to him say, Listen, I don't know how to solve this problem. I don't want to run into a part where I just can't extend my line of credit more and more and more. I said, You got to stop treating people like paper towels right, the invoice is different. Start looking at your people and voice your staffing invoices, more like payroll. And the people took it to heart and I went from 6075 days get the paid down to 45. And just that 15-20 days made a huge difference in cash. Right. A lot of press. Yeah, exactly. Right. And you exactly right.
Gary DeHart 4:34
Yeah. So that was that the biggest 500 employees.
Unknown Speaker 4:39
That was the largest right but I was still trying to solve a cash problem. So I was looking at cash based businesses something where I didn't have to give a receivable and wait for money. So I looked at flower shops I lived in little detail motorcycle repair shops, assembled on a barn grill. I'd never had the big some people want to be in the bar business. It wasn't for me, you know, especially after being a trooper For so long, but about one because it had cash every day, then I built a bar because it was actually throwing off a lot of cash. Then I bought a building with a bar in it. So then I owned a hotel staffing company, three bars. And then I had a building that I had subsidized housing people could live in, and I could just give them lower rents, and they could work for me and those type of things, then about nine more buildings to run out. And that was the biggest part of that I ran all five of those businesses, the property management to three bar restaurants, and the hotels staffing company always will write five LLCs, one reporting entity. Yeah.
Gary DeHart 5:36
And they all had one thing in common cash flow, cash, and cash. And so when did you I didn't look when did you write these two books?
Mike Milan 5:45
COVID.
Gary DeHart 5:46
Okay.
Mike Milan 5:49
And the thing is, I had already built with phonograph, when I was there, it already built a training program called the clear path to cash. It was eight steps to maximizing cash. And it was a two day seminar that I did for a lot of banks around the country. And I trained probably 30,000, bankers, accountants and small business owners over about a 10 year period, and it was on that clear path to cash. And I'm not gonna I should just turn that into a book. And that's what Don't be a dumb business owner is that it's not dumb, like unintelligent, it's dumb, like, don't understand my business, right? And that's kind of the whole premise of it. But it is the clear path to cash was what it is. So I wrote that during COVID. And I didn't intend to write two books. I got the chapter three. In the first book, I'm like going, I can't make this shorter enough, am I gonna make it probably stand on its own? So if you look at the seven minute conversation, it's really an expansion of Chapter Three of the homerun financial system.
Gary DeHart 6:45
Yes, I did recognizethat actually, because I think I didn't make it that far. I think that's the last chapter. I've got to say, I read seven, my first and then the second. I've already read this, probably skip them. Because I read it back to back, read the front door, so I can skip that chapter. Okay. And I like in the are you talking about quarterly or weekly, quarterly annual process? Right? Can you like, what would that look like? And again, thing if our primary audience well, he is the pro advisor, the accounting professionals, small business advisor, and kind of prior to us going live, we talked about the I don't know if it's a reluctance of a lot of the community, again, big public accounting community, who aren't CPAs, even CPAs, who oftentimes don't want to give advice, and don't want to set up these processes or don't know how to set up processes. But I think for them long term, they have to get into that habit as an advisor, to truly start giving some real advice. It's actually going to go somewhere else.
Mike Milan 7:50
You know, it's really interesting. I think this is my 12th scaling heights. It's just that what you said there's a reluctance, not a reluctance, because there's not a will to do it. It's more about the confidence to take what I've done over the past, you know, all your career, which is transactional, right? I know, transactions. I know, this gets, you know, you know, attached to asset, Mrs. liability, and that's an equity piece, you know, that they can understand that. But once you move past it, it's a new ground. It's like going into a new field. going, what's out there? I don't know, I don't know. So being able to interpret what you're seeing is new territory, and having the confidence to say, Man, I don't want to mess up their business, I tell them the wrong thing. I might cause more problems and solve, right. That's, that's the confidence thing. That's why I wrote the books. That's why I do the training courses. That's why I have the free resources on cash flow mike.com. And let's start building confidence. So start having conversations about if you see these things, here are the next steps. And I think that's what the next evolution for advisory services is, is more tools to say, Oh, if current ratio was low, adjust these two things. In my daily business.
Gary DeHart 9:00
Yeah, and you have to stay on top of it. And as a small business owner, I mean, we're probably a domme business owners and that we're so in the business, right? And I don't know who coined it, but in it versus on it, working on it versus on it. It takes up a lot of time it takes up in order to make that process work. You have to take the time and build the process. And for me, I know what I'm looking for from a my accountant is somebody who will set that process up and help us understand which I can look at it and understand generally, what's going on with my business, but they have skill sets and knowledge that don't necessarily mean that I don't have all right and don't spend hours on learning. Again, I've done it long enough now. I know where we stand, but also you kind of read these things like what you are some of the things you've written and think about that when I look at our receivable balls, we've got some pretty big numbers. And I don't mind that, but but I do know that that's not the best place for my cash to be sitting in somebody else's bank account. But it's also kind of nice knowing Hey, well, they do owe me money and unlikely I'm gonna get it. But but there's definitely a negative side to that. So so what would that process weekly quarterly annual process? What should that look like? Ideally?
Yeah. Alright. So from my point of view, I always look at weekly, what we talk about is prime cost, right? What things cost versus what, what I'm selling them for. So as my pricing strategy correct, I always looked at labor hours from a different standpoint, which is what's productive or billable hours versus what's unproductive hours. And I tried to make that around 80%. Right. So in a 2000 hour year, I 2080 hours in a year, for 40 hours a week, about 1800 of them should be billable, productive hours, right? When I'm out there, staffing people, because I've got training, I've got vacations, I got things like didn't have to go into it. But if I'm not managing that every single week, right, at the end of the year, I might have 50%, productive hours. And I'm just paying for what, whatever, unproductive, right? So that was what I've managed there. And the other thing was on, when I had the restaurants and bars, it was the prime cost of what I was selling things for. And it's portion control, right? And you know, you want to make sure that everything that you're selling your cost of goods sold is in line with your pricing strategy, where you're gonna lose money. Yep. So those are the things that are weekly the things that actually cost you money by doing the job that you do. From a monthly perspective, it's more about expense control, right, which is, everything that it takes to run my business is that in line with my what my plan was, and there's a rule that, you know, I use, it's called the expense control rule, it's the one rule that rules them all. Which is when gross profit is shrinking, when you start to see you're having less dollars, because you have less sales or otherwise, you should reduce operating expense, the exact same amount or mirror the change in your gross profit. And I'll say a little bit more simply, which is gross profit is the amount of money you have to spend operating expenses, how you spend it, when you have less money to spend, you should spend less money, right? Yeah. But that's what you're managing monthly. Right. And I have less to spend. So I spend less, on a yearly basis, I started looking at more things from the health, which is, how much debt have I taken on, you know, what's my current ratio and quick ratio and those type of things? Which is, do I actually have enough cash to run the business on a daily basis? But that's kind of how I set it up from a bird's eye view and a year to a really granular view every week?
Yeah. And again, an advisor should be doing that for their clients on a whether it's weekly, quarterly annual, probably all of them, right? If they really want to be an advisor, because that's, in my opinion, that's the job. It's, it's taking over that lead role from the accounting perspective, right? Hey, dude, you don't have any cash left? What are you going to do? You know, I mean, it yeah. Let's hope we don't get there. And so now let's bounce over to the one of your old mentors, I guess, control what you can control. Right. And a lot of that is what you just talked about, right? Expenses. Number one, we can easily control that. Right? There's things we can't control. But how do we? How do you wrestle as a small business owner or as the advisor to a small business? How do you keep focused on controlling what you can control?
Mike Milan 13:28
Well, I tell you what that was, I call it and I wrote a blog articles said, this is the best business advice ever got, is because early on when I was in staffing, there were things that couldn't control, I couldn't control some of the labor laws that were out there, I cannot show you know, some of the ways that people came into our recruiting pipelines and stuff I get, I can drill out of it, but I couldn't when I started to get overwhelmed, but the changes in laws and immigration laws and things that you had to report, you know, through the federal government and otherwise, and it was overwhelming and stressful. I've had when he told me that right? You know, I got 500 employees, and really, that ends up being 2000 employees over a year because of turnover. Okay, right. 500 actively working, but then you got turnover. So you're you're constantly replacing? Well, it gets a little overwhelming. So it's a control what you can control. And what I found out there was I can just control that every person we hire is doing things, right. They look right, they have the right paperwork, they you know, meeting all the requirements to work. And that's where it started, just okay, I can't worry about what the government does, I can't change it can't do anything about it and change that breaker to play by the rules. Well, that carries over to everything else, right? If I can negotiate better pricing on products, I do it because I can control that. But if they give me that price, then I have to control what I can control is my price to the consumer. Yeah, if I have to pay $5 And I want to make, you know, double that. I have to charge 10 I can't just keep a $7 price if they're keeping their price from $5. Right. So you have to figure out which levers do you control because As this is ultimately a machine, you just have to figure out which levers you have to pull at what time and that's, that's what advisory is that? What lever? Do I touch? At what time?
Gary DeHart 15:08
And how do I? Yeah. And then how do I implement that at my client level? That's really, again, knowing the community, being part of the community almost as long as you I think. They're just guys, it just seems to be this reluctance that shouldn't be there. Because they are incredibly intelligent, incredibly well versed in accounting, they understand it, and there's, but there does seem to be a little bit of a void of taking that next step. Oh, I'm not a CPA. So I don't want to give advice. Well, I mean, I think you can even give advice without giving advice, right? Hey, here's best practices. I'm not giving advice. But I'm just saying, Look, this is the best practices or I know ADP now has, as part of their accountant connect or whatever their program is called. They've got benchmarking that's included in it. Yeah, but one client on ADP, you get this benchmarking, which is incredibly good data that you can take to your clients and say, Hey, I know you're in restaurants, and here's 50 restaurants in your area, and their numbers are here, your numbers are there in a negative way. We need to work on it. And just using those resources, I just hope our community can get to that.
Mike Milan 16:24
But you know, what I liked about the industry averages, those are seed players, I should at least be average, or at least gives you a baseline to what you could be. Right? So really good. Just knowing that number is like, Okay, we're here, at least be here. This is what the average person is. And I'd like to think you're better than average.
Gary DeHart 16:40
Yeah, that's a really good point. So your home run lineup? Is this putting you on the spot trying to remember the home run?
So I've got to look at trends. Are we talking about market trends? Or are we talking about trends in my business?
Mike Milan 16:56
I look at four things aren't. So the whole learned lineup is called that because it touches all the bases, right? The income statement, the balance sheet and the cash flow statement. Right. So this one specifically targets the income statement, and I look at four different trends. And I'll go either over three or four or five months, five quarters, five years, it doesn't matter. But show me a trend over that amount of time by look at sales, gross profit, operating expense, and net profit, just those four. And with those I look at the relationship between them, some people go sales are up 10% net profits down 3%. Well, I looked at the relationship. Do I expect that? Because I expect sales and gross profit to move the same? So if sales are up, I expect gross profit to be up. If it's not, that's a big thing being deemed as a problem. Yeah. Or it could be something great, right? Because if sales went up, and gross profit went up, or sales came down and gross profit went up, they would opposite. That's a good thing, believe it or not, sales are down gross profits up. I'm doing less work make more money. Yeah. Right. So I started looking at the relationship between these, because it points me to what I need to look at or fix. That's the big part about advisory saying, Okay, if I see the relationships between the numbers, it points me to the answer. Look, here, the problem is here, in that case of the cost of goods sold, because that's between sales and gross profit.
Gary DeHart 18:19
Right? Okay. Expense control, we've kind of touched on that already. And it's, it's, but it's critical, right? Because it is within your control.
Mike Milan 18:26
It is it's, you know, in the whole rule is the change in operating expense should mirror the change in gross profit.
Gary DeHart 18:32
And I like that, debt to equity.
Mike Milan 18:34
Yeah, this one's kind of cool, right? Because this one is where you, and your accountant and banker are all kind of on the same team. But if you really listen to your accountant or your banker, they give you opposite advice at the same time.
Gary DeHart 18:47
Because they have different interests.
Mike Milan 18:49
They have different motivations, right? The banker wants to give you a loan, so he needs your equity to be higher. The accountant want you to pay less tax. So by paying less tax, you pay tax on income, which gets put on the balance sheet in the form of equity. So you pay less tax, but you also have less equity. So by they're both, right, they're just never right at the same time. Right? Right. So if you need a loan, you're gonna have to pay more tax and get your equity up.
Gary DeHart 19:14
Gotcha. Then the EBITDA, long term debt.
Mike Milan 19:18
And it's funny, right? Nobody's calling their accounting going, Hey, what's my EBITDA?
Gary DeHart 19:22
Talk about my EBITDA. I've got my second cup of coffee, I'm ready.
Mike Milan 19:27
So EBITDA can be used a couple of ways. Most business owners don't know how to use it. It's a substitute word for cash flow that the banks use right now, even though is a it it levels the playing field, right? Because what it does is it takes out all of the effects of management decisions from financing perspective, debt or equity, or or accounting perspective, what depreciation methods we use. So when you add back in interest in taxes and depreciation, amortization, it doesn't matter what method you use. Use, or if you had debt or equity financing, it makes every company look the same from a cash perspective. Right? So that's the first part of it and people go, who cares? You know, it's only for bankers? Well, the way you can use it is, on average, a bank will lend you up to three times EBITA. Now they got some special sauce, and every chief credit officer has got kind of their way of of dealing with it. But if you take your EBIT A times three, it will say that's a million dollars, you know, that can probably not ask for $2 million, because they only give me about a million. Most people don't know what to ask for. They don't know how much they can get. Well, that's kind of the first, you know, check in the sand. Yeah, I can get almost three times the EBITDA.
Unknown Speaker 20:40
Okay. And I think you're explained that really well in the book, by the way. Again, we're not here to sell books, but it really I mean, I read it, I'm like, this is a really good explanation, because again, aware of it aware of the terms, you know, read it here, right there. But your explanation I thought was spot on. It was it was understandable. But right. Thank you. And because a lot of times this stuff doesn't come across as understandable. Yeah. So mismatched assets.
Mike Milan 21:08
Yeah, mismatch financing, is what I'm talking about there. Because match financing. This is one where people go, What are you talking about? First of all, it is one of the silent killers of cash flow. And it's a killer business, because it robs your business of cash through interest, extra interest. And when I talk about missed finance, assets, or miss financed mismatch financing, it's using the wrong loan product and buy something. Alright, so I mean, you wouldn't buy a house with a credit card. But right, why? Because it's 16%. Interest, yeah. All kinds of points, all your points. But it's, it's you got, you know, 16% interest versus three, four, or whatever it is, that's why so the rule in financing is this, it's the length of the loan should match the life of the asset. So if I can depreciate something for seven years, now, I should use a seven year term loan to finance it. So that way, when I'm done, paying it off depreciation ends at the same time, and I'm ready to renew or upgrade or, or, or take advantage of that. So that's the rule in some people don't do that, they'll use their line of credit, you know, higher interest rate, that is something that they can depreciate the way to fix it super simple. Go to the banks that have messed up, I use this. And they'll flip it out, they'll take it off the bounce your line of credit, which you need to run your business and convert it to a term loan, you don't take on new debt, you just pay lower interest, right.
Gary DeHart 22:33
And they probably love to do that. Because now they've got you out there for two right? And two accounts. That's right. That's right. So okay, and then cash flow activity.
Mike Milan 22:42
Yeah. Okay, so that people don't know how to use the cash flow statement, right. And it's the tattletale of the business. It tells everybody where your money came from, where it goes. And what I've done is I've looked at, I look at the three main sections, operating activities, investing activities, and financing activities, and I just look at the net result is that a positive number or a negative number. So I make a three symbol pattern, plus minus minus meaning, operating was a positive number, investing was a negative, and financing was a negative. And then I built a legend to interpret that. So if you keep them in that order, operating, investing and financing, there's only eight combinations that they could be. Okay. So when you put it there and go to the legend, the legend will say, operating expenses are up, that means your core business is generating, generating cash investing activities are down, that means you're reinvesting back into your business, that means I've used money to reinvest or buy assets, and financing activities are also down, which means you're paying back dividends or you're giving money back to your or, you know, shareholders somehow or paying down debt on the long term side. So it just kind of tells you, like, give people all the words to say to a business owner. So you look especially in the homeowner lineup on how to tell somebody more about their businesses, seven minutes.
Gary DeHart 23:59
Okay, fantastic. All right. So I told you, I was gonna challenge you on dollar amount versus percentage, and you chuckled when you talked about percentages earlier. So in your book, you say, Well, you can't spend percentages, right. And so if you're saying, Hey, we're up 10%? Well, you should say we're up $100,000. Right. I mean, if that's the number, so what's the what's the rationale there?
Mike Milan 24:25
If he knows everything, the way I write my books, it's about how to talk to the business owner that isn't financially sophisticated. Right? And, you know, 10% could be $100,000, or it could be $10. Right? Right. So, but if I tell them that, if I say 10%, and it's $10, it means something different to you if 2% is 100,000, right? So I always ask people, okay, well, how much does a gallon of milk cost and percent? No, nobody can answer that question. Right. So it's like going, if I talk in dollars, they understand dollars because they spend hours right, right. So it's about communicating back to the person He doesn't keep up with the percentages or numbers the same way you and I do, right. But it looks cool. Oh, yeah, definitely cool. It's cool. percent.
Gary DeHart 25:07
But yeah, that's a good point, though, because it is, again, most people have maybe I have an idea of where my business is. Maybe I looked at it, you know, two weeks ago, but yeah, can't spend percentages. And, and if it's $10, like you said, it's 10%. Is that $10? Is it $10,000? Is it $2 million?
Mike Milan 25:27
You're forcing them to do math now. Right? Yeah, for sure your clients can do math. I don't use percentage. I don't use words like solvency or leverage or liquidity. You won't get it. Right. Yeah. You know, when I talked about liquidity I talked about it's the speed of cash, how fast can you make something cash, right, and I look at their balance sheet, and I go, this is water, your cash, right? That's your liquid, you've got your AR and your inventory, that can be water, that can be cash, and it just takes a little time. So I call that slush. Then you get your assets, your equipment, your vehicles, those type of things. That's your ice. It can be one water, but it takes a little bit of time to make water. Right. So like that's how I explained liquidity and people.
Gary DeHart 26:04
Okay, I like it. Alright, so we talked about and we're going to probably two more things here. One, the five silent killers of cashflow being AR AP, inventory management, expense control and mismatch finance, and we've kind of financing kind of talked about most of those things. And but generally, how are they the five silent killers, I mean...
Mike Milan 26:27
Most time because we don't listen to them, we don't pay attention. And we just, we give them an invoice. And then we wait till somebody gives me a report to say, Oh, this guy paid in 60 days, right? And then you make a call, it's silent, because it just sits there dead money, you know, and your invoices, were dead money on your shelf, right, your inventory, that you've already paid the vendor, but it's sitting there, right. And what most people do is they don't manage the right amount of inventory. They go Oh, yeah, I just need some I sold five more. I need to buy five more. Well, could it be a dump? You might have 200 back there and you don't know about it? Right. Exactly. Right. So even reducing your inventory, it increases cashflow because, well, you're not taking money out of your pocket to put it back on the shelf. Right? Right. You can also see the game toward AR of course, is not collecting fast enough. It just kills your cash flow because it's sitting on the shelf. Yeah, AP the same way though, you could be paying too fast a lot of times and taking money out sooner than you need to.
Gary DeHart 27:20
Okay. And sorry for the background noise we are at a trade show that is starting to let out. Alright. So we're gonna pick back up where with mismatched financing, tell me what that is. What does mismatch financing what does that mean?
Mike Milan 27:34
Actually miss mismatched financing? First of all, it sucks cash out of your business in the form of extra interest? Guys, let me explain what I mean by that. There are times when we use the wrong loan product to buy something. And a good example is you know, if you buy a house with a credit card, yep. You know, would you do that?
Gary DeHart 27:53
Maybe not. But I get the miles.
Mike Milan 27:56
The miles? Yeah, definitely get them out a lot of miles, right. So but normally, we don't do that because it's 16% interest versus three or four, whatever the mortgage markets are right now. So here's the rule, when you talk about mismatch financing, here's the rule, right, the length of the loan should match the life of the asset, right. And what I mean by that is if you can depreciate something for five to seven years, you should purchase that if you don't use cash with a five or seven year term loan, that way when the depreciation ends, so do the payments, and it's a good time to either upgrade or just take advantage of a paid asset or otherwise. But sometimes what people do and it happened to me is we buy something with maybe our line of credit or we put it on the credit card because it's easy because it's easy, right? And it happened to me where I took in bought a cooler for one of the restaurants the cooler was $7,500 but it put it on a credit card and then walked away I solved the problem at work right away did but then I'm sitting here paying on it you know at that 1415 16% where if I would have just bought it with the term loan or even called the banker to help me fix it, which is hey, I just messed up I bought something and I can appreciate with my credit card they can convert that to a term loan and bring my interest rates way down and maybe 7% Cut it in half or otherwise. So the way you fix it and keep cash from escaping the business is your use the right loan product that has less interest attached to it.
Gary DeHart 29:15
Okay, that makes a lot of sense to me. So we're gonna wrap up we've just covered the seven minute conversation pretty in depth which can I read it I bought it he didn't even give it to me for free Believe it or not I had to pay my hard earned money for this and but it was a good book and again I liked the way it's written because it's written for people to understand it right it's not written like a textbook it's not you know, it's intended to teach and and it does that I haven't made it to the Don't be a dumb business owner. I kind of felt like I am a dumb business owner at times. And we are yeah and being don't understand my business. I am looking forward to diving into that. So tell us Let's wrap up with where are you now truly financial what is truly financial? What are you guys do you And then we'll call it a wrap.
Transcribed by https://otter.ai