211: Creating an Accounting Foundation for you Design Business

Michele  00:00

Hello, my name is Michele, and you're listening to Profit is a Choice. Today I'm welcoming Erin McGee to the podcast, Erin describes herself as an accounting manager for service based businesses. Her big goal is to put you in charge of your money. And as you can tell, we have a lot in common. Listen in as we discuss what is needed to have you in the driver's seat of your business vehicle, if you will, and what it takes to keep you there.  Every day, empowered entrepreneurs are taking ownership of their company financial health, and enjoying the rewards of reduced stress and more creativity. With my background, as a financial software developer, owner of multiple businesses, and the interior design, industry, educator, and speaker, I coach women in the interior design industry, to increase their profits, regain ownership of their bottom line, and to have fun again in their business. Welcome to Profit is a Choice. Hi, Erin, welcome to the podcast.

Erin McGhee  01:09

Michele, thank you so much for having me.

Michele  01:10

Oh, it's my pleasure. We met because we have some joint clients. And we do calls that I've mentioned to the listeners before, that, our our goal here at Scarlet Thread Consulting, is to work with the clients that we support, and with the teams that support our clients, right, we're all working together for the betterment of these companies and these owners that trust us. And so you and I have had a few times at through zoom calls and opportunities to meet and to get to know each other, but also to serve our client really, really well. And it has been a joy to get to know you, and to see what you're building and what you're doing. So if you would Erin, tell us a little bit about you and about your background, and what brought you to the job in the career that you currently have.

Erin McGhee  01:59

Of course, thank you so much. Yes, it has been awesome to get to know you. And something that I've loved so much about stepping in to the interior design industry is how welcoming and supportive. Every business owner has been whether it's been the designers, or the suppliers, or the consultants, you know, it's a really neat industry to be a part of. So thank you. I got started, I was an accountant, I went to school for accounting, and graduated from West Virginia University working with restaurants, and really learned the back office of how business operates. We worked a lot with franchise groups. And so that really gave me the exposure to how important systems and processes are in that franchise method. And then I worked a few jobs as an accountant here and there for different industries. And ultimately, about two years ago, I started my own business, started my business and laid the foundations for building my business and discovered that I truly didn't want to own a bookkeeping firm. And so I've really grown my business to help designers and service based professionals organized, implement and maintain their money by building those money systems for the money that is coming in and going out so they can know their numbers and grow their profits.

Michele  03:34

Alright, so I've got a couple comments I'm going to make about that. First. You mentioned the franchise model. And having worked in that and seeing the importance of systems. You know, we talk a lot here about the book E-Myth Revisited. And it's about building your business as a franchise and looking at those repeatable systems and repeatable processes and things like that. So I love that you mentioned that. But you also said something that caught my attention. I realized you do offer bookkeeping services. But your comment was, I recognized I didn't want to build a bookkeeping firm. Tell us the difference. And I know the difference, but I think our listeners might be like, huh, huh? So tell us the difference between what does it look like to be I'm going to say and I'm going to put in our air quotes that you and I can see. What does it mean to be a traditional bookkeeping firm, and what would you call what you do?

Erin McGhee  04:32

Sure. Great question. So I would say the difference is transactional bookkeeping. Is when you think bookkeeping firm. It's the businesses that offer the data entry just recording transactions, which is a crucial part to the accounting process. However, how I differ and how I kind of view the bookkeeping and the money and the processes is when you when you outsource your bookkeeping, you're following somebody else's money processes. They're recording, you know, the entries for you asking you questions here and there. But working with me, we create that customized system, that customized workflow that works for you and your business and your financial goals. And so, I like to refer to myself and kind of what we do are the role we play in business, the businesses we work with, is more of an accounting Operations Manager, were overseeing that piece of the data entry that's happening, whether through your project management tools, or an office assistant, and your CPA and higher level consultants that work with you, and your business overall, and really diving into your personal goal. So we're kind of that in between Accounting Manager reviewing, reconciling, providing strategy based on that.

Michele  06:07

Yeah, I love that. And transactional bookkeeping. Again, it's not, it's not bad. And it's not wrong, we all have to do something that is transactional. And by that we mean, it like you said, under GAAP, which is generally accepted accounting principles. The interesting thing is, it's not just one way to do it, then we like saying, there's only one way to design what it really comes down to is, again, how do you organize financial data? And then consistency, right, following a process so that it is organized and so transactional? You're right, they usually are just putting in the data. But they may not be here. Here's the difference. I can tell you the difference real quick. If your bookkeeper says, Hey, Erin, hey, Michele, we see something that's a little off, or we think that we're seeing some broken processes, or we noticed that every month we have to come to you and ask for ABC and XYZ, is there a way that we could solve it by doing this? That is more of a consultative accounting Operations Support role than somebody who just allows those things to keep happening and just codes around them? That's the difference, right? Okay. So you know, I love that because I love the whole consultative approach. And most people will say, either my bookkeeper is really great, but they don't talk to me, and they don't tell me anything, or my bookkeeper is horrible. We hear that a lot. But the ones that are the most satisfied are the ones who say, my bookkeeper is really great. And I can talk to him or her. And I can ask them questions. And they actually come to me with suggestions and things that I can shift and move around. I know that when you and I have worked together, it's not been necessarily on a transactional basis. So we've been talking through the process, we have joint clients that are in Ivy, primarily. And we've been talking about the process of how we handle things in Ivy and the flow through to QuickBooks. So that data then is represented properly, to be able to be used later in strategy sessions. And, you know, in retreat, I mean, we have clients that are there. So let's start Erin, and kind of maybe where I think you would start as well, I know that in my program, we always go to the foundation. So very first thing, and I look at things like you know, your strengths and your mission, your vision, your values, and you do something very, very similar. I had a podcast on here with my trainer, and she was really all about starting with the foundation, working on your core, like it doesn't do you any good to lift a lot of heavy weights, if your core is weak, right, you're gonna damage something and hurt yourself. So foundation is important, I would say across all things. And you start there to tell me what you see as foundational and a good set of books.

Erin McGhee  08:54

Yes, so absolutely my process and any service that I offer my clients, we follow the organize, implement, and maintain framework, and that organizes the first piece with any client where we truly dive into those foundations. And I would say one of the main things that we look for right off the bat is their chart of accounts, in their item or product lists, how that is set up, what information is flowing through there, and really diving into those main aspects as the foundations of their financials.

Michele  09:34

Yeah, because if we don't start there, again, does you no good just like with the working out to lift a lot of heavy weights, does, you know, good to have a lot of extra accounts out there that you don't use. You know, I get asked a lot how detailed should my chart of accounts be and I always have this this is an answer and it sounds like a lawyer answer but this is my answer. They need to be detailed enough that you can look at them and analyze and make decisions for your business, it doesn't mean you won't have to dig down further here and there. But you should be able to look at it enough. For example, in income, I don't prefer just one big income bucket, I, at a minimum would like to see income by product and income by services, and then perhaps miscellaneous, I actually really like it when it's income by product categories. So when it's things like income, case, goods, income, furniture, income, soft furnishings, income lighting, because when you do that, and then you match the cost of goods to it, we can quickly on a call, look at it and do some comparisons and realize where we're making money and where we're losing money. But when everything gets dumped into one big bucket income it is you can figure it out, but you got to go like run 45 other reports to try to figure that.

Erin McGhee  10:51

Or you're lost in an Excel spreadsheet trying to make sense of the information that's 100%, I always say you can with the chart of accounts, you can have too much detail. And you can have too little detail. And so that too little detail would be income, revenue, sales, and having everything that you make money on in that one account. And sure, you can dive into that you can pull information out of it. And we're talking hours, just to prepare the report to look at it too much detail is you can have product purchases, kind of that parent account or product income, and then you can have lighting, and like you said case goods, but I've seen where some people will even have, you know, couches versus arm chairs. And so that is too much detail.

Michele  11:38

Or I've even seen it Erin where it came across and it like listed the vendor and the light and the number as individual things. And all of that is just waiting. You look, I know, right? I can see you already given the heebie jeebies in your in your chair, like you're looking at it and you're thinking there is no way I can analyze that it's way too much information. So I think that's really an important piece when you're building that chart of accounts is think about. I know some people are I don't even look at it, but you do you look at it on that profit loss statement. So what you want to do is you want to say and it can it can be it like you said maintained, it can be adjusted over time, I would rather start with too little and add and then to start with way too much and have to get rid of things.

Erin McGhee  12:21

I also think I can always expand agreed. And I think somewhere that you can expand and kind of help more on that software level of organizing all of it is using those products and services. And that's where you can get that detail. And if you want all of your products and services to roll up into, you know, one sales account, eventually, we could separate that very quickly. So I would put all of your detail in the products and services and save the summary level for the chart of accounts for your profit loss. And as your business grows, and it becomes more important to you to see the detail broken out a little bit more or a little bit more. That's where we can make those quick foundational changes and tweaks as your business grows.

Michele  13:09

That's right. Quite often we start by I'll say okay, you know, of course, they might show me your Chart of Accounts, let's look at it. Let's look at the p&l. The p&l was not meant in most cases to be exhaustive, meaning we're not putting every single line of every single thing on there, because it's overwhelming. So what you do is you're looking at it enough to make those high level decisions to even know where to dig in where to dive deeper. So to me, I want the p&l to give me enough information that I know, is this okay, based on the benchmarks, or the indicators, the KPIs or the goals that we've set? Or do I need to look at that, like, for example, sometimes I'll see on some Chart of Accounts, some weird miscellaneous stuff? Well, it is so nebulous, and it may have $50,000. And I'm like, Okay, we don't do 50,000 and miscellaneous. So what is that, to me, when your miscellaneous starts getting really big, and it's not something you either need to go add for it, or you need to put it where it needs to go, you know, and it's a so when you start looking at your chart of accounts, and the owner can't even understand what goes in those particular accounts. We need to rename the account. And we need to make sure that what's in there should really be in there. And I know that's another part of what you also do and look at right Erin is not only what is a good chart of accounts to support them so that they can grow. But you do a lot of work to make sure that the information that's coming over, either by direct input or by a project management tool is actually going where it's supposed to be going right talk about that a little bit.

Erin McGhee  14:52

Absolutely. Yeah, you hit it head on when you just said the owner can't understand. For your business you should never make that statement that the owner can't understand. And that's something that I've really grown my business around and how I help my clients, the owner should always understand even if they're not the ones doing the bookkeeping or the data entry, it should be the process that they created for their business, and oftentimes, owners and money. It's a very complicated subject for various reasons. But the bookkeeping processes, whether you're using a project management tool like Ivy, or you're doing the data entry into QuickBooks, either the you as the owner or your bookkeeper or your office admin does that matters. And it needs, you need to be the one to direct that process so that you can understand. And I really enjoy helping the clients when they have that that light bulb moment of, okay, everything makes sense, I can read my profit loss. I spoke with someone recently. And she had handed off her work to a bookkeeper. And when the bookkeeper gave it back, she made all kinds of changes to the account names and did a bunch of journal entries. And she's like, I didn't recognize my QuickBooks. And that should never happen. It's your it's your business, your money. So my goal, my goal is simple. It's to put owners in charge of their money.

Michele  16:26

And you know that I am 100% behind that, because that has been my life's work for probably almost 20 years. You know, what's interesting when that is it's not just enough to have a good chart of accounts. It's a good naming system. That's what I've also found a new, you touched on that, you can have all the right accounts and all the data going into the right accounts. But if the accounts are not recognized by name, and they don't understand how it plays into the process, that's a problem. And that needs to be sought. And sometimes that's what I see. And let's be clear, we all I'll put it this way, my development team, we've worked with a whole lot of chart of accounts with Metrique Solutions. And the thing that because some of them, well, the majority of them were not financial, they're developers, they are not out here trying to do financials, they're not bookkeepers, and accountants or coaches like I am. So they don't, they're not used to saying 5000. And their comment to me was none of them look the same. None of them are the same. And I'm like, That's right, they are very unique event, even if you I'm going to say, purchase some Chart of Account template or whatever to get you started. Ultimately, you might start there, it never stays there, it always gets adjusted and updated. And so I want you to think about your chart of accounts, your books, almost as if it's a fingerprint you made, the comment is their business and their money, but it's also their process and their books, and they don't ever want an owner, I'm going to get on my soapbox for a minute. I do not ever want the owner of a company to feel like they don't own their books, you own them, period, I've had some that could not get into them. And the bookkeeping company, changed it into a different company and did some different things. You need to know how to get into your books, whether it's studio or does our QuickBooks Desktop or QuickBooks Online or fresh books, or I don't care what books you should, as the owner know how to get in there and run basic reports at a minimum. And so if anybody is listening, and your bookkeeper or accountant is not giving you access to your books, then that should raise a flag for you. Because I also love Erin, how you talked about. So not only do we have to make sure that the chart of accounts is clean, and structure, we need to make sure that the information flows into those accounts correctly, we need to make sure they're named correctly so that we can understand them. But then every bit of that is tied to a process. You know it? It's interesting, I was talking the other day to another business owner and in corporate. And when you have C-suite executives, every one of them in most cases is tied to some type of account on the p&l. Like think about your chief marketing officer. They're going to be tied to the marketing account and potentially some of the income sales account. You look at, you know, if you're offering a product or development, they're going to be on the r&d part of that p&l. Everybody, every main function in your company is tied somewhere to the p&l, which means there's a process that informs every bit of it, which is why at the end of every podcast, I make the comment. Every decision leads you towards profitability or away. We're constantly working our processes to be profitable or not to be profitable. And that's kind of the heartbeat of what you love to do. Right. You like to get in They're with each designer or each business owner and say, Okay, here's some good accounting principles. But show me your process. And let's make these match so that they not only support you, but then you really do understand and feel like you're in the ownership position. Talk to me about some of the things that you've seen in some of the some of the chart accounts that you've gotten. And then talk to us about how you've cleaned up some of those processes. Like where do you see the biggest holes in this? Sure, yes, that was a lot. And a big question.

17:03

All of it is just so yes. Just, I agree with you 100%. I always start out and make sure make sure you're the owner of your QuickBooks Online file or the FreshBooks file, because then you can invite others. So yes, go in login, check your settings, make sure your company admin for sure. And I would say where I've seen a lot of the cleanup happen, that ties back to non bookkeeping processes, right? Like, the foundational pieces, right? Okay, is business expenses versus product purchases for clients. Often times, oftentimes, designers will buy even product for their office through vendors that they use, and having a process for when it's a client purchase. And when it's for your business, or inventory. It really the three different types of processes, accounting processes, when you're talking about ordering product and purchasing. So I would say that one of the main things, you know, after we kind of move on from the very, you know, setting up the chart of accounts, setting up their products and services, one of the main things that I jump into next is making sure that they have good processes for entering purchase orders and paying those purchase orders. And making sure if we don't understand which client it's for that we need to reach out to the vendor and get a copy of the sales order, we want to make sure that we have all of the documents, we need to make that decision on the on the bookkeeping side, as well as on the operating excited for you bought a lamp for your studio, right, that's not going to follow the same bookkeeping and accounting process as a product would where you're getting paid for it.

Michele  20:42

Or reimbursed by the clients. And there's another piece of it that I think some designers or business owners don't think about, I'm going to give the benefit of the doubt on that is when they buy things for their own home. And they're still product purchases, they're going to run them through the company, the majority of the time, but those are actually owners' benefit. So those come out as an owner's draw or owner's distribution, you know, are benefited the owner, they they're not a cost of goods the same way. And they're not an expense the same way, it is actually income for the designer that he or she chose to purchase a product with. Just like it's different. Like you mentioned, when you're buying things for a store or to use later, those are assets. That's the inventory, that that's not a p&l item. And really understanding so how product flows through the firm. You also mentioned about making sure that everything is connected properly. And I think that's very important. We're hearing more and more and more now that things are stretching out for a long forever. To wrap up a project, we're hearing a lot more clients that are finally wanting to do project counting. I know that was one of the systems I built when I was in software. And I've asked people for years about project counting. And in the interior design industry, it was rare that anybody wanted to do it. And now you're hearing it there's they're becoming more like I would say, the way that the construction company that construction industry either does their books, they're very project oriented, not just for those working on it, but even for internal staff, like every single thing is managed to a project. And we're starting to see not maybe not that far in interior design, but at least down through gross profit. We're at least seeing that part that has been very project specific. And so aligning all those things really, really matters. And do you help clients look at things that way as well?

Erin McGhee  24:38

Yes, that is one of my favorite reports to run. And why it's one of my favorite ports to run is because that means that we've built the accounting processes correctly to be able to run that report periodically. Look at it high level and make decisions for the business on types of projects and yes, I I will praise the project profitability report in QuickBooks has that feature, you can, you can toggle your p&l to run it by client or by project. And you're able to see your p&l in a way where you can compare a full house versus a partial house design or just your design your projects where you're just doing design consultation work. And so you can start to compare apples to apples and oranges to oranges, rather than apples to oranges, right. So looking at that as helpful, we were just talking about a client who we ran that report for and then we're able to identify similar projects and kind of create that benchmark of Alright, on average, this is where our project Product Revenue has been. This is where our design fees have been. How can we how can we next year create the goal to go a little bit more and a little bit more. And so having that report is so helpful? For so many reasons.

Michele  26:06

So, you know, I was just talking to a client this week who we realized when she actually loaded her data into Metrique and saw it differently. At my workshop that I had from our clients, we build our strategic plans a couple weeks ago. And it was an aha moment for her because she had not seen it that way. But what it made her realize was that when you're looking at a project, and you're looking at some of the work, she thought she was billing and thought she was profitable, and one way, but the numbers showed something different. So just like that project profitability report, it's using data, I mean, really all we're saying here, no matter what you're using, is if you are if you have data from a product, or a sale, or a purchase, or a bill or whatever, that the payroll, right, whatever that data is from, use that data to inform your decision making moving forward. And that that's where your books have to be clean enough and clear enough that you can look at that empirical data, you know, do some calculations and make decisions if it's a hot mess, you know, what do they say trash and trash out? If it's a hot mess, then you can't trust it. There's nothing Well, there's a lot of things worse. But there's very little that is worse than having books that are so screwed up that you have no clue where you are. I've worked with many, many, many designers over the years that were multimillion dollar businesses. And their books were a hot, hot mess. And they didn't know where they were and what they were doing their processes did not align that how they were assigning the, you know, the transactions in QuickBooks. And they never knew if they could get paid if they couldn't get paid if they had money, and they didn't. And that's sad. To me, these are multimillion dollar businesses we're not talking about, I made my first 50,000. And I'm not sure how to allocate it. And this is a learning I'm talking about. This is the successful design firm in the design room that is struggling to even figure out if they're sustainable, because the numbers are missing.

Erin McGhee  28:23

Right. And I have seen that as well, with different service based industries that I work with, you mentioned construction lawyers, bringing in a lot of revenue. But the owners are still living paycheck to paycheck, because from my perspective, after we dive in and have a conversation, every single client I've talked to have not had systems that tie back to their money. And they made decisions to up their marketing or higher based just on emotional gut, you know, feeling which again, is a part of it. But there has to be with what you and I do, there has to be some some fact, with the numbers to make those decisions. And so why I focus so much on those processes is because the numbers that you look at that you need, and that we want to put into metric, they have to be right, in order to do anything with them or otherwise, you can put them into metric and you can make a decision. But if you're if your books are trashed, you're making, you're making poor decisions.

Michele  29:35

Absolutely. Strategies, everything right. So I work first in strategy, and then let's tactically figure out how to get there. We get to know where we're going. And that's the same thing that really that you're doing is you're fixing those pieces and parts and working with them the foundation, the systems, tell us where you want to go and let's create the systems. That's also one of the reasons Erin that I I've been Profit First certified since 2015. We're eight years in here, because it's a money management system. So I know you're not profit for certified. But you certainly support companies that are using a Profit First method. So if they're trying to move their money, to protect it, and to really manage it, that that net profit at the end of the day, you're going to help them do that. So there are strategies that we can build that manage our money all along, I've always said, Here's how you make money. Here's a Michele code for you, you sell the right product or service to the right person at the right price, and you manage the heck out of it. And that's really what we're talking about here. So we can talk about it from a marketing perspective or whatever. But this is really about managing the sale. And part of managing the sale is managing the money, and how it flows through the company, recognizing that your gross profit and your net profit are not the same thing. I don't know about you, but it drives me crazy when people just use the word profit. And I'm like, I don't even know what that word means. For what your are you talking gross, you're talking net, you're talking before taxes after? Where are you talking about profit? Right?

Erin McGhee  31:11

Please tell me you 100%. And yes, I am not Profit First certified. But I do follow. You know, that method for my business, and also my clients who are interested in that. And following that I give the book I'm like, read it, well, we'll set up a process for you so that you can implement stressing this money management system in your business. And although the profit first model, right is the same from you, to me, and our clients, how you implement using it in your business is different. And that system for when you sit down to look at those reports, and to make sure the numbers are right, are different, the goals are the same, right? But the way you do it, and how you do it is yours. And it's unique to you, and it should be unique to you. So again, similar to owning your own QuickBooks file, if you do not own your money processes. That is definitely something to put on the goals list for next year, because that is a huge piece of your business.

Michele  32:13

I agree. Again, I love it. I think I've just come up with this is your financial fingerprint. I like that because that really is what it is. Right? I'm going to write that down. Don't you guys may see that show up later on like that is your financial fingerprint. So, Erin, talk to me for a minute about I know that we've kind of talked around it a little bit. But talk to me about your experience helping your client, our joint client helping her look at her books and Metrique because you've helped her and her books are loaded out there, as are her numbers are loaded. Tell me about how you can use Metrique to consult with your client, like how does what does that look like? Short? As the two of you look at that? Absolutely.

Erin McGhee  32:58

Absolutely. So yes, so we first started working together, going through the foundations of her books, kind of cleaning up the processes from the previous bookkeeper and accountant got the workflow down and making sure that Ivy and QuickBooks were connected, so that the information was useful. And then we're able to load up the data into metric in hand and hand it off to you. So that's kind of where I like, what I do for my clients. And what you do for years is this handoff of the baton right with the information. And so it's been really awesome for me to help get the processes down, clean up the books, and then be able to load that information that clean, validated, removed, reviewed, reconciled information into a dashboard, that for me, I don't have to create every time in Excel each month.

Michele  33:56

And it's ours, let's be let's be real, are all the data that is out there that that we can show off of the p&l and some other decisions that have been made? I know that my accountant made the comment she said, Michele, this is hours of work for every client to be able to show it like because it's multiple reports pulled into one place. And you found the same when you were that it would have worked for you to present it.

Erin McGhee  34:24

Absolutely because right when you when you in the same way you're learning to grow and scale your design business. accountants and bookkeepers also do that right? And so in order to provide my clients with good visuals, before my treat you below the download that p&l into an Excel Doc, you turn the numbers and you make them look pretty with colors and charts. And that work takes hours and if they're a monthly client, like I said it's that's each month and so to have a software like Metrique to be able to pull that information in and have that client facing display of information that's important to them, right? Because the information that's important to one client is going to be different from another. And so for me, it's such a benefit for the owner, the and the end user, ultimately is such a benefit. And so yeah, I've been, I've enjoyed being able to upload that clean systemized bookkeeping information into the software, and then having our client be able to use it and make decisions to grow her business. And for the next three, I think we're even talking about three five year plans now. So

Michele  35:37

that's yep, that's what we were building is three to five year plans. You know, one of the other things I think that is so interesting is, you're working so hard, and I'm working so hard. So we're working kind of in parallel here, right? My whole goal is to help everybody own their company, I love I used to have a tagline in my email that says what you own, you can change, like, I can't change what I don't own, I can't change my attitude. If I don't own that, I might have one that needs adjustment. But I can't change my business or my financials, if I don't own them. So we've been talking about as business owners, for the listeners, we want them to own their company owned the design on the company, but own the finances. And here's what it means to own the finances, then what my goal is to help them own the strategy in the financial understanding and how that the financial display fits into the strategy. And then you're coming alongside and saying, Okay, if this is the strategy, that you know, you and shell, or you and your team have established, let me help you financially, make sure we have processes in alignment to get there. And let me help you look at the metrics that we need. Then when you can go in and look at metrics with them, you can just go and click right to the metrics, right that you guys are choosing to watch to your point, it's different for every person. And then for me, as a coach, it's helpful because I can say, where is it that you want to go? Well, here's what I'm seeing. And this is what it looks like, just a different perspective. But all with the idea of helping that owner, own the firm sit in the driver's seat, right of the car, with a dashboard in front of him or her?

Erin McGhee  37:15

Absolutely. And I even I'm thinking back to a call where all three of us were on a on a zoom call, and I think it was an hour. But that strategy piece because we were able to come to you and say, Hey, Michele, I'm seeing constant variances in these numbers. I'm constantly having to make adjustments. Like on the design side, there's something that the designers are doing, and they're, again, a non accounting piece, right. But in the designers process, there's something going on there that's causing the information for me to be a lot of work. How can we fix this and smooth this process out. And so that, for me was that kind of lightbulb moment of just it takes, it takes a village, right, and people looking at the financial information in the processes in different ways, for different reasons. I

Michele  38:07

remember that. And I think another ah ha with that was realizing, again, that goes back to when we talked about transactional bookkeeping versus consultative bookkeeping, you could have easily just thought, well, I'll keep fixing it every month, because they're paying me for the time. So they're, you know, it's going to cost him more, but I'll keep fixing it, whatever. And instead, you looked at it and said, This is really costing us time that could be spent on analysis, it could be spent on strategy, it could be spent somewhere else. So can we go downstream and try to fix the process so that when it gets here, it's cleaner, and easier. And we were able to talk through that with the business owner. Again, I always say it's like kind of looking at a football game. And we're sitting in different places, we all see the same game, but we're seeing it through a different lens. And so we were able to then, kind of you know, it's like when there's a bad play on the field. And they show it from three different camera angles. And before they make a decision and all truth. That's what we were doing, put her business on the field. And we had three different camera angles, and we then combined those to make a decision on what to do. And it solved the problem.

Erin McGhee  39:17

Yeah, I love that. That's a perfect analogy. I couldn't have said it better myself that that's awesome.

Michele  39:24

So Erin, as people are listening, and they're thinking my books are not maybe where I want them, or I don't even know if my books are okay, you know, what can they do? And how can they reach out to you to maybe say, Hey, can you can you help me out? Or can you look at this, like, what can you offer to allow people to say they might need some assistance?

Erin McGhee  39:47

Sure. So very first thing I would say would be on my website. We talked a lot about Chart of Accounts. I have a chart of accounts, a free download for interior designers. So again, this is a blue print for just, you know, the design industry as a whole, it is meant to be a resource, a starting point for the designers to take a look and compare the information in their software to my recommended chart of accounts. And so I would say, definitely download that, grab that, pull your report and kind of compare and re listen to this episode where we talked about going into too much detail or too little detail, you know, kind of where does, where does your Chart of Account document, fall there. Second would be I have a 30 minute complimentary call, where we just jump on the phone and kind of chat about what's going on specifically to your business. And listen for some, you know, areas in which I think I can help prove improve processes. And then after that, I would say we can jump on a call and do a bookkeeping discovery consult, where we kind of take the lid off your financial systems and software's and just kind of like you mentioned the football field, we just kind of lay it on the field and see what you know, what's working well and what's not. And, and from there, we create a plan where you can then take that that detailed plan and implement it yourself as the owner and have kind of a outline for how to build those really good bookkeeping habits in your business. Or we can do it together, or I could do it for you. So I kind of have a three tier approach there. But definitely just drove back to the foundations and take a look and ask ask for help. We're all we're all here to support business owners. Like I said in the beginning, it's such a, it's such a great industry to be a part of.

Michele  41:43

yeah, it really is. I love your offering. So I'm going to go get that chart of accounts and check it out. I'm excited. I love that. No, it's really, really good. And I am going to, I'm going to jump in here and plug Metrique. I really am. Well, number one, it's an amazing piece of software, and it's still continuing to grow me. And we're in our, you know, infancy, if you will, we just launched within the last couple of months. But I gotta tell you, that has and the feedback that I'm getting not just from users, but from their supporters, their bookkeepers and their accountants. They're saying that, and Erin, I don't know if you offer this, but many of the ones that are consultative in nature there, they offer at least a 30 minute call every month to say, here's your p&l, maybe somewhere in our write based on the relationship, here, your books, here's what I'm seeing that it added that kind of like where you're talking about pulling together all those reports, yes. And they're the feedback that I'm getting is the meetings are so much more productive, because they actually can see it and point to it. So they can look at I'm going to call it a flat p&l with numbers, right? It's black and white. But then they can see and charts and graphs. And so it's really that, looking at it with the three different cameras. And it enlightens them in a way that you just don't see it the same when it's black and white on a piece of paper.

Erin McGhee  43:08

Yes, yes. So after we go through and kind of take a look at those foundations and the processes that I recommend to be implemented into your business. If we decide to move forward and continue working together. My monthly or quarterly clients, though, receive their financials on that periodic basis, and then we'll schedule a call to review them. And that's where I love Metrique because I'm able to load the information into the software, say, Hey, your dashboard is ready. Here's also, you know, the like you mentioned the flat p&l just to have it look at right, absolutely. But hey, your dashboards ready. Here's your p&l, let me know when you've had a chance to review what my clients pulled together their questions, what seems off for them, or, or, Hey, I'm going to start to really work towards this goal. And then like you said, our calls are so much more productive, because we've all come prepared for to play the game, right?

Michele  44:07

And you all know what you're talking about and what you're looking at it best been the biggest thing I think, because so many people say I'm looking at report, but I don't know what to do with it. I don't know how to use it. And Metrique is meant to tell you how to use it and how to look at or to give you the information to know how to do that. So I'm glad that it's working for you and for your clients. And that makes me happy. I'm Erin, it has been such a pleasure to chat with you. And I really want to applaud you for the business that you're building. That starting with a good foundation in bookkeeping, and that's focused on the processes. It's interesting. I have helped a lot of people leave bookkeepers, find the keepers, because of the more transactional nature and that's really, it's not as supportive for really creative service based businesses. It's hard because it's so structured and You are a little bit more lovely. Yeah, I'm going to say in the way in the way that we move and change our businesses. And so just your intention to dive into the process. And that's what I keep hearing over and over from going to say they're really great bookkeepers is they help you create a process that also fits with the, the other software that you're using. So if you're using a project management tool, they may all integrate differently with QuickBooks and, and how that data is transferred. And it would place in the process that data is transferred over. And so their goal to keep those books clean, so that they can be counted on and trusted and used by your accountant, you know, by your coach, by yourself, by your business by anybody who's trying to help you, it's really has to focus on the process. And when you get the process, you cannot change it. Meaning in the moment, you can't just screw it up, you have to stick with the process. And when you find that there is a problem with the process, then you can address it as a whole. But it's just meaning that there is one way to capture that data and move it through your company in a financial sense. So I love that that's where your heart and your focus is.

Erin McGhee  46:11

Yes, thank you. I appreciate that. And yes, and we do offer bookkeeper, transactional bookkeeping services as well, of course, but you won't start working with me, unless we've gone through that and making sure that your foundations are good, because I just can't it's not it's not in me to just do transactional bookkeeping without asking some questions.

Michele  46:35

Well, and that's why one of the things that I tried to be careful with and I in some ways, I just call it either coaching malpractice, or financial malpractice is when you give information that is kind of just off the cuff without really knowing what is happening in that business. It'd be like a doctor walking into a room and just prescribing something for you. Because maybe he's getting a kickback or he loves that drug. And he thinks it's awesome. And it doesn't even align with why you went to the doctor. And so I I'm very careful about that about like, I don't just do the blanket raise your rates who do that, like that. That's not that that's not the case. And the same for you. So you can't just go to transactional without doing some type of investigation to make sure that it's a healthy set of books that you're working with. Absolutely. Well, Erin, it's been great. Tell us your website and where we can find you online.

Erin McGhee  47:26

Thank you. Yes, thank you very much for having me. My website is ErinMcGhee.com, MC, GHEE and on Instagram @ErinMcGeeLLC.

Michele  47:37

Awesome. And I will have all that in our show notes. I'll also if it's okay. I'll put a link to your chart of accounts. Absolutely. Yes. Awesome. I will take care of that. Well, thank you so much, and have a great day.

Erin McGhee  47:48

Thank you.

Michele  47:50

Thanks, Erin for the awesome discussion today. Starting everything with a firm foundation and then a strategy to move forward is a great game plan. If you need help getting your Chart of Accounts foundation firm, reach out to Erin and check out her free download for Chart of Accounts. I would love to help you work on their business foundations and the strategy to ensure that you're spending time on the most important things. You can apply for a discovery call at scarlet thread consulting that calm and if you want to see your financials as Erin and I described, go to Metriquesolutions.com and watch the demo and then sign up for the money dashboard that makes sense to the creative brain. Be in charge of your profitability because profit doesn't happen by accident. Profit is a Choice is proud to be part of the designnetwork.org where you can discover more design media reaching creative listeners. Thanks for listening, and stay creative and business minded.