Franchise Freedom

Stop Working Harder & Start Making More: Franchise Financial Freedom with Rocky Lalvani

• Giuseppe Grammatico • Episode 213

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Is your franchise running you ragged? 😫 In this episode, Giuseppe Grammatico sits down with Rocky Lalvani, the Profit First expert, to discuss how franchise owners can escape the "working harder, making less" trap. Rocky shares actionable strategies for building systems, creating financial dashboards, and mastering your business levers to achieve true time and financial freedom.


➡️ Connect with Rocky Lalvani: 


➡️ Learn more about Profit Comes First: https://profitcomesfirst.com/ 

➡️ Explore franchise opportunities with Giuseppe: https://ggthefranchiseguide.com/right-fit/ 

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The Franchise Freedom: Discover Your New Path to Freedom Through Franchise Ownership, Book by Giuseppe Grammatico https://ggthefranchiseguide.com/book or purchase directly on Amazon.


I did escape corporate hell. Right. And I built my own business and we didn't exactly use franchises, but we use licensees for two different companies. And basically what I do now is really what I should have been doing my whole life. I work with business owners and I help them to be a business owner. The math doesn't lie. The problem is a lot of people think math is hard and it's not. I get it. It's an emotional thing, but for me, it's not that big a deal. I happen to love the numbers and it's easy for me. Budgets are like diets. Everybody hates them. Let's, let's talk about setting a target and measuring how we are against the target and then creating a system for cashflow management. Welcome to the Franchise Freedom Podcast, where you can escape the corporate trap through franchise ownership. Here's your host, Giuseppe Grammatico, The Franchise Guide. Welcome to the Franchise Freedom Podcast. I'm your host, Giuseppe Grammatico, your Franchise Guide. We have a very exciting episode today. We have my good friend, Rocky Lalvani from Profit Comes First. Rocky, welcome to the show. Thank you so much for having me back, Giuseppe. Excited for our combo. Welcome to I'm excited. It's I think this is our, maybe the fourth, fourth appearance on the show is going back and I'm like, we, we have some awesome conversations. So like, let's keep it to an annual thing. You know, we, we have some great conversations. So, hopefully you're cool with that. Give the audience a little bit of background of, of who Rocky is and, and what Rocky does. So I, I did escape corporate hell. Right. And I built my own business and we didn't exactly use franchises, but we use licensees for two different companies. And basically what I do now is really what I should have been doing my whole life. I work with business owners and I help them to be a business owner. What I mean by that is we get them out of working harder. And making less to making more money and working less and enjoying their business and their life They started a business for freedom and money Well, then your business better provide freedom and money and franchises are a great way Put a system in place where you don't have to go through all the hard knocks of screwing up first and figuring it out. Yeah. And I, I always say that not every franchise is built the same, that the service offering the support is not always the same. So that's a big part of the diligence, but so let's, let's, let's talk about that with, with systems because a lot of people, as you mentioned, I did a show on the five freedoms from Dan Sullivan that you can experience from owning a business time and financial. Or the top two mentioned, maybe the top go to. So we'll focus on those two. So, obviously you started business time freedom. I know for, for myself, it wasn't there. All right. I was working my butt off to get this business up and running. So, you know, talk to us a little bit about, you know, how, how do you help people work on versus in the business? So working on versus in the business really is accomplished by a having thinking time. Right? So you've got to think about the business, not be the doer in the business. We've got a system in place of 15 different levers. So every business has different levers and different businesses, it, it works differently. So think of a lever. One of your levers might be marketing. Right. One of the levers is hiring employees and spending. One of the levers is your pricing. One of the levers might be repetitive customers. We sit down and we look at the entire business. We figure out the different levers that make sense for that business. And then we just start playing with it to say, Hey, if I change this lever, what's the expected outcome? And by doing that, we can look and see which lever at this moment is going to give you the greatest reward for the least effort, right? If we go look at the lever and we make a change to it and go, wow, you know, doing that would take a lot of work and. The outcome is not that much different. We're not going to focus there. So we really helped the business owner focus on what do I need to do in the next 30 days to make a difference in the business and to my bottom line, we also create dashboards for them so they know what's going on in the business. So you're Jersey, right? So, you know, you probably all giants or jets fans. It doesn't matter where you are in the country. Right. But imagine going to the super bowl. And here you are, day of the game, and you're going to watch the game. And you look down at the field. And there's no lines on the field. How the hell do you know where you are? They turn the clock off. They tell the referee to go home. We don't need him anymore, right? You're not important. How are you going to know how that game is going? What the score is and whether or not you're winning or losing you're not and the reality is nobody's gonna watch that game Right and yet so many business owners Do that in their business. They don't have a scoreboard. They don't know what quarter of the year they're in necessarily, or how they're doing against their goals, or they don't their scoreboard. So muddled. They don't even know what to do about it. They don't have a playbook to say, okay, you know, it's 4th and 1. And we're here, what should I do? Oh, here's a playbook. This is what we do on fourth and one. And that's what franchises provide is that playbook. And but what I find with franchises is they, they, they go, here's a dashboard that don't tell you how to really what play belongs to that. They give you the basics, but they really don't show you how to work the financial levers. And that's, that's the problem. And that's the problem that we solve. So, Work less, make more. That's my key. Yeah. And that, and that's the thing, you know, you, you talk to people and you know, when you talk about financials, that's something that could be you know, you, you can measure that, right? It's like, all right, doing well, I increased sales by 20%, but yeah, or, or 20%. But if you're working 50 percent more hours, there, there, there's an issue there and it's getting those systems. So, so basically this is a compliment to the franchise. So franchisees would be able to utilize your services and kind of in order to, to help them out and balance these, these freedoms that, you know, the, the time and financial you know, who, who would be a typical, so is this, is this you know, you'd be able to help someone and maybe we, maybe you can give us some examples, but someone that's just starting out with the franchise or, or maybe someone that's a little bit more established. Well. We have a mutual connection, right? He's starting a franchise, right? That he got through you. And we had a chat and he said, well, here are my guesses of what's going to happen. And he's like, let me get everything up and running. And then I need you to tell me, are my guesses right or wrong? Are we spending money appropriately? Are we able to achieve? These types of goals, you know, when you start a new business, if you're not buying an existing one, you got to go out and get sales. And too often we spend a lot of money on marketing. It's the one area that I see most franchise owners spend a ton of ton of money. But if you don't measure your marketing, you don't know What works and what doesn't. And we're constantly talking about marketing, right? Because we each have to sell, right? So we get this and it's, you know, I know you've spent a lot of money on marketing and some of it has worked and some of it hasn't, but you got to measure that and you have to know how that lever works and when you can create that well, and hopefully the. The franchisor gives you a good marketing system, and then it's you figuring out in my market, which of these systems works best. Is it Facebook? Is it, is it this, is it that, how do I use that appropriately? Plus all those things are constantly changing. So we were just talking about Podcasts and downloads and systems keep changing, you know, Google changes its algorithm. You got to learn to constantly be on top of it or you're doing what you did last year and the world changed and you got left behind. Yeah, no, that's, that's a very good point. You, you're constantly measuring. I always tell people, you know, as a, as a business owner, you have your, your KPIs and you know, lead flow, you know, or, or closing rates, you start to measure all that. And it's like, okay, my, my clothes, my clothes rate is down 50%. Well, is it the quality of lead? Should I be changing my marketing? Is it my process? The design process needs to be changed. And you're doing that with your staff. When I had my other building service business and, you know, close ratios were, were either up or down. We would always measure to see what, what changed. Should we review the marketing or does the salesperson maybe need some retraining? So, there's a lot there and we talk about it a lot. Yeah. And that's a key. Like, let's say you got three salespeople and your numbers are down. Well, if you look at them and two of them have 70 percent close ratios and one has a 30, now, you know, Oh, there's the problem. Now we can fix it. But if, if you don't know that the one thing salespeople are good at is selling the owner. Right on how good they are, but if you don't have the results in the numbers, how do you judge appropriately without the emotion? The math doesn't lie. The problem is a lot of people think math is hard and it's not. I get it. It's an emotional thing, but for me, it's not that big a deal. I happen to love the numbers and it's easy for me. So it works out well. Yeah. And one, and one thing you've helped me with, and this was a game changer, just, you know, it's budgeting and ROI. So with budgeting, I never had a systematic way to kind of budget. And with, with profit first, we talked about, well, you should put aside, you know, every dollar that comes in. You know, 20 percent or whatever the number is, goes to marketing, paying yourself first. And I never in my entire career had a system. It was basically, you know, in my last business, if there was money in the account but that's how, that's how I paid myself because we were always. Charging and then getting paid hopefully within 15 days. So, and paying our subcontractors after the fact, but it was based off a cashflow, which was actually the wrong way of doing things. Cause we didn't have at the time a monthly PNL, so that was super helpful. And then, and then ROI, it's like, okay, this is my 20 percent and that 20 percent is, we'll make up a number 50, 000 bucks. Well, okay. Of that 50, 000, what is the ROI? Should I be 3, 4, 5x ing that type of you know, those numbers in order for that to be sustainable? And that was never taught to me as a franchisee. Not a knock against a franchisor. It's just not, they always just said, you know, this is kind of the average spend per month. Not percentage, but the dollar amount. So that was super helpful. Can you, can you elaborate a little bit? Any. Recommendations you know, along those lines. So here's the thing. Budgets are like diets. Everybody hates them. Let's, let's talk about setting a target and measuring how we are against the target and then creating a system for cashflow management. That's what you're talking about. When I started this franchise, 15 percent profit margin. Well, okay. Every time a dollar comes in, let's put 15 percent aside. That's your profit margin. If you can't run the business on 85%. Why not? Where is, where are you overspending and where are you wasting money in the business? I mean, the reality is running a business is just like people, you know, when you were in your twenties, maybe you got a job paying 30, 40, 50 grand. You know, today, if you're in your forties or fifties, you're making six figures and it seems like there's less money. It's because of lifestyle creep. Right. People own businesses, and so those same financial things that people experience in their personal business owners experience in their business, and we get business lifestyle creep, right? Oh, we need to do this. Oh, we need to do that. And then the other part of that is employees don't understand finances. So if you haven't taught your employees to be financially savvy. Well, they're just going to waste your money. Cause that's what they've been trained to do. They don't think about, Hey, every time I waste something or do something wrong or let that slide, it's money out the door. So you got to change the way you focus. That's a, that's a great point. And part of that is on, you know, is on the business owner as well. Something I learned years ago, my last business is. We would talk about profitability, but we never showed the employees. So we would have quarterly meetings to say, because, you know, they, sales were up, they saw business was going well, and they expected bonuses and, and things like that, which we always tried our very best in order to take care of everyone. And I said, well, just because sales is up, doesn't mean profitability is up. So we would talk about, okay, sales are up, But we're actually making less money because of X, Y, and Z. So I think having you know, being transparent with the staff and you don't have to give them access to your QuickBooks, but I think giving, letting them know this is kind of where we stand on a quarterly basis. We are, we are making more money, but with that being said, we need to make cuts here, here, and there. My general manager, I even gave him some Phantom equity every quarter. He would get a distribution of the profits. So, so he was cognizant. He was aware. Do we really need another employee? Do we really need extra marketing or should he go out every Friday and, and, and, and network at the chamber of commerce events and things like that. So I think part of it to your point is yes, they, they, they're not aware, but we also are not empowering them to, to, to be aware, right. With the with the data, with the information. So that was a big change. And I think people realize like. Wow. We're, we're, we're losing money and sales are up. What, what changes, you know, how do we, you know, we're a team. How do we make the changes together? And I'm a big fan of rewarding employees who can help you lower operational costs or efficiency. So if an employee comes up with an idea that saves the business owner, 10, 000, give them a grant. Give them two grant, right? Create the atmosphere of everybody going, Hey, how do we make more money? Cause at the end of the day, a purpose of the business is really simple. To make more money and and we add in while working less Because I don't want people to kill themselves. You didn't start this business to kill yourself You shouldn't there are ways to do this And and you've already got a system with the franchise of how to deliver your operations Now you just need a system on the financial side In and how to really maximize and spend time thinking about the business instead of being stuck in the business. And if you're employees now, just look around the room, wherever you're working and ask yourself, is everyone in here making the company more profitable? Or are there a bunch of people here who are just taking up space, right? And when you own a business, you're going to have the same problem. You got to ask yourself, is this person taking up space? Where is the return on what they're supposed to do? How do I improve it? Like right now you see with fast food, right? They're getting rid of people galore and they're putting in. Ordering screens and apps and ways to, to cut employee costs. And I I'm not against people and workers, but you've got to do it right. That's why I love Costco versus like Sam's club, you know, Costco pays its employees a lot more than Sam's club does, but when you go there, you get a very different experience. And so you got to think through that. How am I going to build my culture, my values? How am I going to run this business to be the type of place that people love to come to and do business with versus ones that it's, it's friction to do business with you. And I don't think business owners realize how much friction they put in place to do business with them. The easier it is, the easier it is. Look at Amazon. One click. Bye now. Yeah, it's, it's, it's a simple, the Amazon is the perfect model, right? I mean, you have, you have everything. I, I, I follow Marcus Sheridan from, they ask you answer. And he, and he said, Amazon, you go there, you get reviews, you get so you can do your research. It's easy. It's one click your data saved. If you want to look at competitors and other, you know, I'm looking at a wireless mic, for example, I just purchased, I purchased two, two mics to, to bring to our conference next week. And they gave comparisons and you can test them out. They're easy to return. It's, you know, go, go to Amazon and then go to your website. And I joke and say, pretend like you're a customer. I go to your website. Do I know what the heck you even do? And that's sometimes a mystery. What do you do? And give, give us an idea on pricing. If you're a 50, 000, minimum to meet. And that's the cost, you know, maybe, you know, you're giving some data, but that's going to rule, you know, rule people out and just say, well, I don't have that type of funds. Maybe I need to go a different route, but just being open and transparent will help. Will it increase or decrease lead flow? It could be both, but that the quality of lead at the end of the day should increase. So, absolutely shop yourself. You know, just see, just see like, you know, maybe have someone else, someone not biased, a friend kind of maybe, you know, search the site and give you some open some some advice as that where, you know, areas of improvement. So, so true. What else what other advice did you have? So a lot of the audience listening in is our corporate execs looking to make that, that first move to entrepreneurship. And yet what other advice do you have for them? And many of them have never owned the business before. Yeah. And I think, you know, this is the problem. People who don't own the business don't realize how much is involved and how difficult. It can be to build everything yourself. So like I partnered with profit first, everything that's in that profit first book is the way I built my wealth. I understood it fully. And then I'm like, well, if I understand this fully, what do I need them for? And then I realized, well, then I have to write my own book. I have to market it. I have to create the templates and the, the different things that I'm going to use for my delivery. And I'm like, wait a minute. I don't want to do any of that, right? By partnering, which is what a franchise is, they provided me all the templates. That name of profit first has opened so many doors for me. Like, think about it when you're driving down the street and you see McDonald's or, you know, Jojo's burger bar, where do you go? Right. You know, depending on where you are, the branding and all of that stuff that might not be in your wheelhouse and it might not be the parts of the business you love, right? Yes. You can go create it yourself. But it takes a lot of work and effort. And so this is the shortcut to, to get through all of that. And I think that's the big part until you, that's the problem until you do it, you really don't get it. And this is an easy way to kind of get it without having to kill yourself trying to learn it all and, you know, figure out the marketing and the delivery and the production and the sourcing and the design and the layout and creating the user manuals for every employee and did a lot of work. Overwhelming. It's overwhelming. Yeah. And that, like the, the people who are my clients don't have franchises. We spend half our time talking about, you need a system and a process. And they're like, I don't have time to build one. I'm like, yeah, well, hello. You need to make time. Yeah. Or it's going to be this constant struggle. Who what, what's the who should be contacting you and and where can they You know, get additional information and reach out if they're interested in learning more. So, I think any business owner who is allergic to the financials or wants to outsource the financials, cause they're like, look, this is not my wheelhouse. I want to go focus on these parts of the business. I need somebody helping me. To understand the financials, tell me what to do so I can go do it and keep track of everything. So, and it doesn't matter how big or small you are. We have a program for, for startups and for, for small companies that it's more of a do it yourself. And then once you get to a decent level or you want to hand it off to somebody to help you with, then, then we help you there. The website is profitcomesfirst. com. You can find me there. I do have podcasts where we share a lot of what we do with our clients and, and also about life. So Profit Answer Man and Richer Soul is, is where we do all of that kind of stuff. Awesome. We're going to put all that in the, in the show notes. This was awesome. I, I always like, catching up. I, I always learn a lot and looking forward to having you again. I think we're going to make this a minimum an annual thing. So, maybe we should just record our, our general conversation. I think people would get a lot out of that, you know, just our conversation prior to this about marketing and, you know, sometimes you just need the other person to say, well, what's worked in the past. X. Well, why aren't you doing that anymore? I don't know. And that's the thing we forget. And that's what the franchise gives you the system that you constantly go back to the basics, right? It's really about doing the basics, right? The football team goes back to, to, to, you know, training every year, right? How often do you do that? Good point. Maraki, it was a pleasure. We we hope to talk to you very soon. Thanks for having me. Thanks again. If you want to learn how to make the transition from corporate to owning your franchise, join Giuseppe on the next episode. You can also follow on all social media platforms and achieve financial and time freedom today.

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