In this episode of the Main Street Business Podcast, hosts Mat Sorensen and Mark J Kohler delve into managing personal finances and small businesses in an uncertain economic climate. Their lively conversation is packed with insightful advice and practical strategies.
Here's what you can look forward to:
This episode is a must-listen for anyone who wants to navigate their personal finances or small businesses more effectively in unstable economic times. It offers a wealth of knowledge on everything from debt management and budgeting to pricing strategies and cost-cutting measures.
In this episode of the Main Street Business Podcast, hosts Mat Sorensen and Mark J Kohler delve into managing personal finances and small businesses in an uncertain economic climate. Their lively conversation is packed with insightful advice and practical strategies.
Here's what you can look forward to:
This episode is a must-listen for anyone who wants to navigate their personal finances or small businesses more effectively in unstable economic times. It offers a wealth of knowledge on everything from debt management and budgeting to pricing strategies and cost-cutting measures.
So I want to say this. In today's economic climate, there are five to ten things you can do, and we're going to go through those here. And this is why we're talking about this. And I want to say these should be not just an election year. I don't care if it's a good economic climate or a bad economic climate. These are things we should be doing anyway.
Mat Sorenses:I think a lot of people are like, what should I be doing differently? You know, this is an election year. If so and so wins, it's going to go the stock market and the economy is going to go on fire. If so and so loses is it's going to be chaos and the country's going to, and I need to move to another know, like, I need to move to Canada.
Mark J Kohler:It's like, okay, all right, you need to have a plan. It's not always going to be sunshines and roses. You've got to have a plan. So we're going to present that plan today.
Mat Sorenses:Welcome, everyone, to the mainstream business podcast. This is Matt Sorensen. I am sitting next to the great and powerful Mark J. Kohler. We are so stoked to be with you today. Talking about what, Mark?
Mark J Kohler:Well, it's a somber topic. It is serious. It's what to do, maybe right now in this economic climate. And also does the election year impact it? We're getting a lot of comments in social media, hey, what do you guys are doing or recommending? Does it matter if it's going to be red or blue? And what's going on with Trump versus Biden and going to, should I change my investment strategy? What should I do? Fair questions. We've got, I think, some very helpful answers. But most importantly, there's millions and millions of Americans that are feeling the pinch. It is bad. People are using credit cards to pay for groceries. They're not sure what things are going to be looking like. The cost of living is off the chart for a lot of people in certain brackets of income. It's very challenging out there. And we understand that. We're about Main Street America. Matt and I both grew up in simple homes with hardworking parents. I grew up on a farm. Matt was in the suburbs. Both of our parents were business owners and real estate investors. Also had w two s at times. And we just really have a lot of life history, too, that we hope will impact this. But lots to share on this.
Mat Sorenses:Yeah, I think we're in the trenches, too, as business owners and just out there trying to make good decisions, but we've also had the thousands of consults with clients, seen what works and what doesn't and also been through some years where it's been tough and had some scars ourselves and some lessons we've learned there. So let me hit the first thing, though, about the election year thing, because I just have an opinion about that. There's differences of opinion about this when you bring up election, obviously.
Mark J Kohler:Yeah, I have some good political debates, by the way, not that, I mean, I think we're both business owners and we like good business policy, but we'll leave it at that. But, yeah, the politics of it.
Mat Sorenses:Yeah, I think a lot of people are like, what should I be doing differently? This is an election year. If so and so wins, it's going to go the stock market and the economy is going to go on fire. If so and so loses, it's going to be chaos and the country's going to. And I need to move to another know, like, I need to move to Canada. It's like, okay, all right. Now, Peter Malook, someone I listen to on this stuff, very smart, award winning investment advisor. He's done all the statistical research on it. He said it makes a zero difference whatever party's in power, he says every year, election year, and this guy's been doing it for 30 years. My clients go berserk. And my message to them, what are we going to do in an election year? The same thing we did the year before. It doesn't move the needle. And so the focus on it, I think, is a lot of wasted energy. There's different policy things we care about as americans that get us excited one way or the other on what's going to happen on election day. But from a financial standpoint, don't create more chaos in your life by making poor decisions or emotional decisions, knee jerk decisions or political decisions. I should say, too, some people are like, I'm going to leave the know.
Mark J Kohler:Come on.
Mat Sorenses:All right, settle down.
Mark J Kohler:All right.
Mat Sorenses:And I got those, I've had those conversations with clients. I need to give up my us citizenship. Can you guys help me with that? Okay, slow down. So firstly, my message is going to be, let's not overreact. Now, there's a lot of things in this climate. It's a weird economy right now where I think there's been some winners and losers. Obviously, it's a strong economy, but there's definitely been pressures in certain areas and a lot of people have certainly felt it.
Mark J Kohler:Yeah. And we've got a list of probably ten different things here. We're coming to, but we got to get this kind of this right out of the gate. So I want to repeat that name. Peter Maluk. He's got great book. He's co authored with Tony Robbins as well. Please do some Amazon book searches, pick up his book. I think it's very sound, good policy reading. And you know what? His message is very similar to the Warren Buffett's the Tony Robbins, the Dave Ramsey's just the wolf of Wall street that was interviewed recently on what program? Who was out there on the extremes is now back.
Mat Sorenses:I love how you quote him. I'm always like, wait.
Mark J Kohler:Well, he's out there saying, here's what I learned. Don't do what I did for those years. And it's all back to sound quality, long term investing. Be careful. Now I've got an example for you. This is good. Okay, everybody, this is super good, because sometimes when the storm clouds come, we can make knee jerk reactions that just really can destroy everything we've been building for years. Two words, waste management. For some of you that may have been following the news, two weeks ago in Phoenix was the Phoenix Open waste management. Now, this has been around since 1937, and the Thunderbird club is the one that established it has had a lot of success over the years with this really cool golf tournament. And corporations come around from around the country, around the world to schmooze and have fun. And this is one of the more party type PGA events. Some of the players don't even like coming here because it's nuts on the 16th hole, yada. But it's been a lot of fun last couple of years. It's just been a great experience, what happened this year. So in the middle of this week long event, essentially, I won't get into too many details, Phoenix, it is like Garden of Eden in February, but not this year. The storm clouds came. Now, again, this could be some economic, let's look at the metaphor here. It could be some economic challenges. It could be an election year. But the storm clouds came. And if you want to start reading the news clips, they were actually interviewed the president of Thunderbird yesterday, and he said, everything's on the table. He goes, it was a disaster. So here's what happened. Knee jerk reaction. Wednesday, rain clouds come court, you were there on Wednesday. I was there on Friday. Yeah, the rain clouds came. They postponed the course. It was mud and water and everywhere, and people and corporations had spent thousands and thousands of dollars to be there, and it was a disaster. And so knee jerk reaction. Do we get people money back. What do we do? They didn't have a plan. And they said, we'll just let them come back tomorrow. That was their theory. We don't want to give them their money back. Millions of dollars in corporate sponsorship and tickets sold. We're just going to, you know what? We'll spread them out over Thursday and Friday, and they can come back. We'll let them come back. And so I was there Friday. It was like Disneyland Times three. It was insane.
Mat Sorenses:It always is. Chaos and busy there.
Mark J Kohler: Yeah, it was next level. And so what happened, though, on Thursday and Friday, intermittent weather, continued. Knee jerk reaction. Got to solve the problem. Got to make major changes, not stick to the tried and true procedures. Saturday, by 09:00 a.m. They just opened the doors. They just said, everybody come in. Let's just come have a great time. We don't want to give money back. Just come. And they estimate over 30,000 people that weren't even ticket holders because everybody was calling their friends, get over here. The doors are open. They estimate over 500,000 people on the course. And it got chaotic. I had some kids that were there. I didn't go Saturday. I was there Friday. They said it was apocalyptic. They thought it was almost like CGI. How do you get that many people in that small space? And what is everybody doing?
Mark J Kohler: They're drinking. They're pissed. I can't see golf. It's nuts. And it was. A lot of those sponsorships is free alcohol. It was off the charts. Some of you were like, I got to get on YouTube. I got to read on this. But the story ends where, at 02:00 the cop said, this is going to turn into something very bad. And the police chief said, I don't want to be the next resignee first. Next one to resign says, no more alcohol. So they shut all the bars from corporate to all the booths. Everything said, no more alcohol at 02:00 and the fire chief was in on this, and they said, that'll get rid of everybody. And it did. I can't get a drink. I'm not here for golf. I'm out of here.
Mark J Kohler: And so by 05:00 it started to dissipate, and they said, no one else can come in. Well, I had a friend that flew in a client on a private jet that day for the event. They had spent thousands of dollars to take him to the corporate booth for the Saturday afternoon. Big deal. We're getting to the final pieces of this tournament and couldn't even get in. And they'd spent thousands. So you have corporate sponsors that are now blocked from coming. You know, you've watched the YouTube video sliding in mud and jumping in the lake. I mean, it was know. So anyway, we're going to see what's going to happen.
Mark J Kohler:There's going to be some fallout, but the moral of the story is, and thanks for letting me explain this because that really is going to set the stage for our list, is you don't overreact, you don't knee jerk. You have a plan. And that's what this podcast is about. I hope that was somewhat interesting, but it's just been fascinating how you need to have a plan. It's not always going to be sunshines and roses and you've got to have a plan. So we're going to present that plan today.
Mat Sorenses:I like that, but I don't know who said it, but it's always great to have a plan until you get punched in the face.
Mark J Kohler:Everybody's got a plan until they get.
Mat Sorenses:Punched in the face. Then what am I doing?
Mark J Kohler:I don't know if the Thunderbirds had a plan because there's something out.
Mat Sorenses:They definitely got punched in the face on Wednesday and it was chaos throughout the week, but.
Mark J Kohler:All right, well, I like that.
Mat Sorenses:Let's give you some things to make a plan and start thinking about this and be ready.
Mark J Kohler:We got the first five.
Mat Sorenses:Honu says, I think he says be ready. So you don't have to get ready. Just be ready. All right. Be ready, everyone. All right, so first one we want to hit is budget.
Mark J Kohler:I know, it's boring. Okay, I've got that as number three. What was the number one for you? Just do PNL.
Mat Sorenses:Well, that's how you get to the budget.
Mark J Kohler:Well, fair enough. But some people. Okay, may I?
Mat Sorenses:Two for one here on the budget and PNL.
Mark J Kohler:Okay.
Mat Sorenses:Know where your income and expenses are.
Mark J Kohler:You know what? I need to rephrase that. Do a balance sheet. That's really what I meant. Okay, fair enough.
Mat Sorenses:All right.
Mark J Kohler:I own that. When I was saying, I was like, why is he going there? We were writing this down, going because we've done some similar podcasts on this and we really wanted to fine tune something for today. No, do a balance sheet. What do you got?
Mat Sorenses:Yeah, what's your inventory? Your assets and also your liabilities?
Mark J Kohler:Your debt?
Mat Sorenses:Yeah, where's my debt and what do I have? And I should give your net worth number to know where am I at right now? A good plan has to first identify where are you at. Then you want to identify, of course, where you're going. I like to do it in ten year chunks and work backwards. But let's figure out where you're at right now from assets and liabilities. That's your balance sheet.
Mark J Kohler:And I think even before you get to that budget, you approach debt. And I like the way you talked about approaching debt. It's not just get out of debt.
Mat Sorenses:Yeah. Mark said, let's just say let's get out of debt. And I'm like, let's be strategic about debt. Everybody get out of debt. Well, duh. But how do I get there and be strategic about it? And there's different examples of this. For example, should I take out a home equity line of credit? When you look at my balance sheet, it shows that I have equity in my house. Should I use that equity and leverage that to pay off high interest credit cards? Should I use that equity to start the small business? Should I use that? You know what I mean? Let's be strategic about it. Should I start pay off my student loans because they're in deferment? And I think if Biden gets reelected again, go back to election, it could be like these are strategic debt decisions. Where am I allocating my income? Which gets to your budget here in a second to get to tackle this debt that's on my balance sheet.
Mark J Kohler:Yeah, I like doing that. Balance sheet number one, and having a plan for your debt, which doesn't mean always a debt snowball. But I will say this. If there's some bad debt, and we've had shows on good debt versus bad debt, please go back and listen to those. But if you've got some exposure there, subscribe to Dave Ramsey. I can't say it any better. The guy is the goat on getting out of debt, and now he's going to take a hard line. He's going to want you to get out of every possible debt out there. Now, we differ in the fact that we like good debt that makes you money, whether it's business debt or real estate debt, that creates cash flow. So keep that in mind. Don't buy all in on that. But there's so much consumer debt that we need to get rid of. He's got great approaches to student debt, how to build a debt snowball. We have resources on our site for that, too. But I like what Matt said. We can't go in at wholesale.
Mat Sorenses:All debt's bad.
Mark J Kohler:We've got to be smart. So that's number two. Now, budget, may I turn you loose?
Mat Sorenses:Yes.
Mark J Kohler:What do you like about budget?
Mat Sorenses:What I like about budget, I think, I mean, obviously budget. Let's just be clear about this. We're talking about where's your income, sources of income, and what are your expenses every month? What do you got to cover every month in your budget? But you should also be including in your budget. One thing I want to make sure everybody's doing is what am I putting aside? I'm not talking about getting by. I want to make progress. And that progress could be paying off debt, as we just talked about putting, maxing out retirement accounts. We want to be the crowd of people who maximize our retirement accounts, not our credit cards. So am I maximizing my retirement account contributions? Am I buying the rental property year? Am I investing in my small business to try and grow or the side hustle? Am I investing in my career? If that's my focus and getting better skills that are giving me better earning income power. So don't just think of it as my food, my travel, my auto, my rent, and everything like that. I want to get a little next level on your budget about increasing that income side.
Mark J Kohler:Yeah, I love it. Now, my take on this, and I want to repeat this for everybody. We know it's tough out there. We've got family members that we're helping get through this difficult times ourselves. We're making adjustments. And so I want to say this. In today's economic climate, there are five to ten things you can do, and we're going to go through those here. And this is why we're talking about this. And I want to say, these should be not just an election year. I don't care if it's a good economic climate or a bad economic climate. These are things we should be doing anyway. And so I'm going to repeat them. Number one, at least know what you've got in the bank. What are your assets? What are your liabilities? Number two, should you have a strategic approach to some of that debt? Number three, and sometimes I hate the b word, the budget word I like. Just track it. At least tell me what's coming in, what's going out. It's so hard for so many people to get on a budget, but at least pencil out what is my net cash flow every month, and hopefully it's positive. Then. Number four, and this leans towards Matt, is taking some of that money, if you have a little excess and building some cash reserves, this is Dave's Ramsay 101 as well, is that crap's going to happen, and you're going to get back into credit card debt. If you don't have a cash reserve for when things go bad. And in this economic climate, they could get worse. So once you get your balance sheet, you got your debt plan, you're tracking where your money's going. Have that cash reserve. And I love what Matt said. Make sure you're still building for the future for that next purchase, that retirement account. And that's where that tracking and budgeting is all about. We don't want it to be miserable. You can say, I can do a thousand a month. I can set it aside for cash and then for my IRA or whatever it would be. And I think those are the first four. We got more, but those are the first four core to deal with this current economic climate we're in.
Mat Sorenses:Yeah. And I think tracking is so critical. Just think of any business that's not tracking their income and expenses. How the heck do you expect that business to succeed? Like, it's going to be total chaos. Yet so many individuals do that. So many individuals that their personal budget just don't track it. And they're not thinking about that and being strategic and having a plan waste management open.
Mark J Kohler:Which brings us to number five, liability. And there may be some lawsuits. So who knows on that example, number five, do a legal review as well. If we're going into an election year, that could be precarious. Fair enough. There's a lot of people out there that do feel it could be precarious in an economic climate that's unpredictable. Be ready. I loved how Matt said that. Are your entities all in place? We've got this new BOI reporting for Finson. Are there entities you need to get rid of? Do you have an estate plan? The last thing you need is a lawsuit right now. Are you up to date on your minutes and your corporate structure and legal structure? Do you have rental properties and investments that need more protection? I'm going right now through some insurance adjustments from one state to another. Do I have the right insurance policies? Am I overpaying for insurance? That's part of that legal review? Am I lean mean? And this is a circle, the freaking wagons. Circle them.
Mat Sorenses:Yeah. Are my beneficiaries up to date on those insurance policies or bank accounts or retirement accounts? Have I had life changes like that? Do I have an estate plan? Do I got minor kids? And all these things, these give you certainty and peace of mind, too, that when you're in a world of uncertainty, can give you a little bit of peace and comfort. I think your estate plan is one of those things that's been on people's list for a long time that they're just like, put it off, put it off. No. This is one of those. It's going to give you some certainty and planning, and so I like that. The other thing that's really unique for 2024 for any business owners, real estate investors with entities, is you have to comply with the new Finsen rule, the BoI business owner information report. Every LLC s corporation entity out there, you're going to have to comply with this. There's a federal filing you got to file. We're helping clients in the law firm and in our business, mainstream business services, where we help clients maintain their entities. And we have 10,000 plus clients we do that for. That's mainstreetbusiness.com. But that is another thing. You need to add your list. The government put this on your list for 2024, whether you like it or not.
Mark J Kohler:Yes, I love it. Now, these are down in the description. There's our five. Now we get into the next five, and these are business related. Now, some of you are like, well, I don't own a business. I don't want to go there. Okay, let me try to educate you on a few points. First of all, a side hustle is a small business. If you're getting a 1099 for doing anything, and right now, estimates are that well over 40% of working Americans have a side gig. They got a 1099 company. It could be driving Uber on the weekend. It could be selling something on eBay, some sort of Internet commerce. It could be a consulting gig. Any other income you're getting outside of a w two relationship, that's a small business. If you have a rental property, that's a small business. You're creating income, not as a wage earner. That's first of all, many of you are like, oh, I'm already there. Yeah, we got five tips for you. But my first one is, of these five is if you don't start creating another source of income to rely on, and if you do have a gig or a small business, start creating more sources of income within that business and being smart, going, hey, I got to create more income here because I need more to fall back on if I have problems personally and in your business. That side hustle, that side gig, those extra sources of income, so much, so important as a business owner and as an individual.
Mat Sorenses:Yeah. And I think for any of you that do have the business or the side hustle, this could be your main gig. This could be the side hustle gig. Is I think the number one thing that savvy business owners do is they are focused on the services and products they're delivering and the pricing. As the world's changing around you need to be making changes in your business. If we've had inflation over the past four years, that's been on a straight up trajectory. Have you changed your pricing? All of your other, your customers are used to paying more everywhere else for what services they're getting. Maybe this is why you're feeling the pinch, is you haven't addressed your pricing. Are you in a competitive business space where there's lots more competition now? Do you need to be enhancing your services and offering more and trying to distinguish yourself from your competition? So I want everybody to look at their services they're offering and also the pricing of those services.
Mark J Kohler:I think there's a lot of you.
Mat Sorenses:Business owners that are under pricing your services. Your customers are used to paying more and would pay more so long as your services are excellent and you're delivering.
Mark J Kohler:I love what you promised. Yeah. And Matt hit seven and eight. I want to repeat, number six in our top ten list is now shifting to creating more sources of income individually or revenue within your business. How could you create more? And I like what Matt said. Number seven, pricing. Really looking at the quality of your services and looking hard at it. Nothing's off the table. I liked how that President Thunderbird said, too. Hey, we hit a crisis. Everything's up for talk. And don't be protective or emotional about, well, we've always done this service or we've always done that. It could be a loss. Well, we're going to come to that on number nine. But look at your pricing and product mix. And product mix was number eight. Being diverse, could you provide different services or more services for some of you like, well, I don't have that big a business. Let me give you some examples. Are you driving Uber? Should you pick up some doordash and Grubhub with that? Should you be doing Lyft and Uber simultaneously? I've heard a lot of people saying, hey, when there's not an Uber ride, I'm picking up a Grubhub. Oh, when I'm not doing Grubhub, I'm over here at Doordash. Oh, when I'm not on Lyft, I'm over on Uber. And see, now you're diversifying even as a. Like, where can I create additional revenue next? Are you using Turo? Do you have an extra car laying around that you're like, hey, I don't even use my car on the weekends or during the week. I commute with public transportation. Put your car on. Turo, could you be making money with an asset that's just sitting there? Not Waverly, outdoorsy. Could you put your rv. There's estimate over 20 million rvs out there in America right now sitting on the side of someone's house. Could you clean that up and put it on Waverly and create some income with your rv? Are you doing an id accessory dwelling unit? Adu, could you have something you could add to your space where you live to create some extra revenue? Do you want to rent out your basement? Do you want to rent out another room? See, that's getting creative with, in a sense, pricing, diversification, and extra revenue.
Mat Sorenses:Yeah, I think a lot of times it's just working with what you already have, working with that property. You could add to ADu, maybe doing a pad split on a property, that's a more beneficial way to get income. Maybe going to a midterm rental instead of doing long term or short term. Maybe that's the right price point where you can maximize. This is getting creative with a lot of the things you already have. And I'll add to that, this is for everybody. Increase your skills and knowledge.
Mark J Kohler:This seems.
Mat Sorenses:It kind of goes without saying, and that might take some investment, actually. That may take some money, that may take some certification, some training. You need to invest in yourself to increase your skills so you're more valuable to then go earn more money and have more income power that you can use to acquire more assets so you don't have to work at some point. And what it's. One of my most successful friends was a medical doctor, and I remember him telling me, he said, this is how you get rich. He's retired, he's my age. It drives me bonkers. But he's like, learn a valuable skill, go work hard, and charge people for it, and use that money to buy income producing assets. That's it. That's all it is. Everybody's got. You got to earn the money first to be able to have money to invest. Then you got to be laser focused and work hard to do the work to it. Then you got to invest it income producing assets that eventually produce more than you. Working in your limited amount of hours you can do in a day. There's no more hours in a day. That's the one bad thing about being a lawyer. You can only bill an hour in an hour.
Mark J Kohler:Well, for some lawyers and divorce lawyers, they've got a different approach.
Mat Sorenses:Yeah, you can cap out anybody in the service business, you know what I mean?
Mark J Kohler:How did you work 32 hours in one day?
Mat Sorenses:But that's it. And I think it goes back to that very first step of increasing your skills, which increases your earning power and your value to any company, or whether you're owning your own small business or you're working in a business that will let you have more income to acquire income producing assets.
Mark J Kohler:I combined pricing and diversification and product development. I put that all under number seven. I created number eight, more education. And I want to add to more education. That doesn't mean always go signing up for a class or a course or a college class, heaven forbid. I don't know. I love college and university. I've spent years there. But is that going to move the needle next month in my income? And so you got to be careful of what education you choose. But some of it is just being on some good podcasts, signing up for some online courses that could be a few hundred dollars getting in some communities, whether it's a closed Facebook group, discord, whatever. What are you trying to learn about? And instead of going home, life sucks. I'm not making ends meet. Life sucks. Stop on the way home, get a six pack of beer and snuggle up to Netflix or prime. That's not increasing your education. And I think it doesn't have to be a big deal. Number nine and ten, I'm going to say these are kind of the cutting piece. Before, it was like, let's generate more. Now you got to make some hard decisions. And so I'm going to say, number nine is maybe getting rid of some things that are low margin. They're not making you money. Come to find out, driving Lyft is not as good as Uber. I'm going to go back to Uber. Uber is not as good as Lyft. I'm going to go over there. Or maybe I've got a product in my landscaping business that's a waste of time. Doing fertilizing over here is not good. So you're going to do that.
Mat Sorenses:Family or friends, you've been a customer of yours for years that you're charging that old price and you grandfathered them in.
Mark J Kohler:Stop. I love it. Let's unpack that. As well as number ten is just cutting costs. There may need to be some employees that need to go. There may be additional software. How many of you have gone and looked at what's hitting your credit card on a regular month of annual or quarterly or monthly fees for software and this, that or another. And just showing some austerity. And that means getting rid of expenses I don't need and assets. See, we go back to the original balance sheet. Are you sitting on two four wheelers or a jet ski or a boat that you use two weeks out of the year? Holy crap. In a climate like right now, maybe it's time to sell that and turn it into some income producing small business or another asset. So tell me your thoughts on kind of low margin again and cutting costs. I just wanted to get those out.
Mat Sorenses:Yeah.
Mark J Kohler:The one thing on the kind of.
Mat Sorenses:The low margin, this is a corollary to that or ancillary. Ancillary to that. Adjacent to sitting next to related to that is some of you might need to hire an assistant. Some of you have low margin work that you're doing in your business that needs to be done, but your time could better used providing the services, getting sales, marketing, whatever those things may be. And so hiring the people in your business to take things off of your plate, that gives you more earning power to provide the services that have a higher return on your time.
Mark J Kohler:Wow. Low margin activity. Low margin activity.
Mat Sorenses:I like that.
Mark J Kohler:I'm going to write that down when you come into work tomorrow.
Mat Sorenses:I'll be like, I ain't doing any low margin activity today.
Mark J Kohler:I'm worth more than that. Oh, my gosh, that is so good. Low margin activity. I just want to say, we don't want to let the pendulum swing too far either. Sometimes people just go a little too far. They start cutting costs that are actually watering down the soup. Stephen Covey, in his first book, Seven Habits told a number of stories, are really exemplary of small business. And an example was a restaurant that wanted to increase margins. They were in a tight situation. They had a line out the door every day. And the owner said, well, I need to increase profit, so I'm going to water down the soup a little bit. And for a month or two, profit soared. Cost of food costs went down, profit went up. Then the line started to shorten and Shorten, and pretty soon the business was gone because he had watered down the soup. And so whatever you're doing in cutting costs, it's about reallocating as well. And looking at, am I pricing, diversification, product development, and not sacrificing your core value?
Mat Sorenses:Yeah, I love it. That's a great example. Let's end with soup.
Mark J Kohler:Okay. I love soup.
Mat Sorenses:All right.
Mark J Kohler:I am hungry. All right, well, thanks, everybody, for being here. Hopefully this helps. Ten tips to survive this economic climate and an election year. And I think the first main theme of this was have a plan. Get ready. No knee jerk reactions. Let's see it coming.
Mat Sorenses:Yeah. I love the planning part. Have a plan. I like writing down the plan, by the way. Sticking to the plan, checking on the plan, updating the plan. Mark and I both carry our own strategic plans for our businesses and individually, like, mine's in my bag. That goes with me when I travel or whatever. So my favorite things to do is check in inventory on a plane, or I got a moment to look in on how things are going. Make a plan. Be intentional about what's happening in your life. And I think getting a plan on this can give you peace of mind. So whatever chaos is going on outside of you in the world, you at least have a plan for what you're doing.
Mark J Kohler:Perfect. Well, thanks, everybody, for sharing your time with us. Very valuable time. We hope this is part of your number eight on your list, and that's staying educated and getting better and better at what you're trying to do. The american dream is alive and real. And I'm just going to say this isn't the first time we've had these challenges. Do we need to go back to 2008, the tech crisis around 2000? How many recessions have there been? Life goes on. How many world wars? Just go back 100 years. Go interview your grandma, go interview your dad and say, how bad is it? You don't have it, man. I'll tell you how bad it is. That'll make you feel good. You're like, oh, okay. I think looking at the history will also tell you that the sky's not falling. It's not great, but we can learn from the past as well.
Mat Sorenses:Yeah. All right, see you next time, guys. Thanks.