Nannette Ray was born at the height of the Civil Rights movement in Mississippi. Her mom was a single parent who worked several jobs and died when Nanette was in the ninth grade, which instilled in her the desire to make her mother proud.
She went on to earn her MBA, own two Kids ‘R’ Kids learning academies and to found and become president of TNR Advisors & Management Consultants, which helps many child care centers with financial decisions and planning.
In this podcast, she describes the path that she and her husband took to becoming child care center owners and to helping other owners with the financial aspects of their businesses. A key part of that is looking forward rather than focusing only on the past.
She discusses why she opted to open a franchised daycare versus an independent center as well as common mistakes she sees in how new owners operate child care centers, such as not operating with a budget.
You can learn more about Nannette and her work to help businesses make data-driven decisions at www.tnraccounting.com!
About Nanette:
Nannette Ray recently received the Houston Business Journal’s Women Who Mean Business award for 2021. As founder and president of TNR Advisors & Management Consultants, Nannette is responsible for measuring, managing and improving overall performance of the organization and day-to-day operations.
She has successfully run various companies over the last 16 years and uses this knowledge to successfully perform as managing partner. She runs the business with her husband, Terrence Ray, who is a CPA and the company’s vice president.
Nannette is a mother of three who holds an undergraduate degree in accounting and information systems from the University of Texas at San Antonio and holds an MBA from St. Mary’s University in San Antonio, Texas.
Additional Resources:
To get more insights on ways to succeed in your child care business, head over to our Resource Center at www.procaresoftware.com/resource-center.
Contact Us:
Have an idea for a podcast or want to be a guest? Email us at podcast@procaresoftware.com!
Nannette Ray was born at the height of the Civil Rights movement in Mississippi. Her mom was a single parent who worked several jobs and died when Nanette was in the ninth grade, which instilled in her the desire to make her mother proud.
She went on to earn her MBA, own two Kids ‘R’ Kids learning academies and to found and become president of TNR Advisors & Management Consultants, which helps many child care centers with financial decisions and planning.
In this podcast, she describes the path that she and her husband took to becoming child care center owners and to helping other owners with the financial aspects of their businesses. A key part of that is looking forward rather than focusing only on the past.
She discusses why she opted to open a franchised daycare versus an independent center as well as common mistakes she sees in how new owners operate child care centers, such as not operating with a budget.
You can learn more about Nannette and her work to help businesses make data-driven decisions at www.tnraccounting.com!
About Nanette:
Nannette Ray recently received the Houston Business Journal’s Women Who Mean Business award for 2021. As founder and president of TNR Advisors & Management Consultants, Nannette is responsible for measuring, managing and improving overall performance of the organization and day-to-day operations.
She has successfully run various companies over the last 16 years and uses this knowledge to successfully perform as managing partner. She runs the business with her husband, Terrence Ray, who is a CPA and the company’s vice president.
Nannette is a mother of three who holds an undergraduate degree in accounting and information systems from the University of Texas at San Antonio and holds an MBA from St. Mary’s University in San Antonio, Texas.
Additional Resources:
To get more insights on ways to succeed in your child care business, head over to our Resource Center at www.procaresoftware.com/resource-center.
Contact Us:
Have an idea for a podcast or want to be a guest? Email us at podcast@procaresoftware.com!
[inaudible]
Speaker 2:Welcome to the childcare business podcast brought to you by pro care solutions. This podcast is all about giving childcare, preschool, daycare, afterschool, and other early education professionals, a fun and upbeat way to learn about strategies and inspiration you can use to thrive. You'll hear from a variety of childcare thought leaders, including educators, owners, and industry experts on ways to innovate, to meet the needs of the children you serve from practical tips for managing operations, to uplifting stories of transformation and triumph. This podcast will be chalk full and insights. You can use to fully realize the potential of your childcare business. Let's jump in
Speaker 3:Good morning, everyone. And, uh, you know, again, welcome to the childcare business podcast. My name, if you haven't been with us before, is Ryan Gwaltney and really excited to have you join us today. And, uh, I'm excited about our guests excited every week. Uh, but you know, obviously this is no exception today. Uh, we have somebody on our show joining us. Who's made quite a name for herself in the business realm. In fact, um, you know, our guest today has recently received or been the recipient of the Houston business journals 2021 women who mean business award. So Nanette Ray is the founder and president of TNR accounting and management consulting, which brings together and Annette's years of experience in an accounting management and it consulting graphic design. Plus her time owning two kids, our kids childcare centers, uh, her extensive knowledge and business acumen make her a valuable asset to the childcare community. As owners directors look to stabilize their business or better yet grow. Uh, let's see Nanette. She has an undergraduate degree in accounting and information systems from the university of Texas at San Antonio, and holds an MBA degree in finance from St. Mary's university in San Antonio, Texas. Uh, just a little personal background. The net has three grown children and is married to her best friend and business partner. So really excited to have you join us today in a net. Welcome to the show. How are you?
Speaker 4:I'm doing great, Ryan, thank you for having me. This is so exciting. I'm looking forward to it.
Speaker 3:Yeah. We were excited to, you know, our paths cross. And so we're going to talk about that, like our company and your company, our paths cross quite a bit. We have a mutual shared customers. Um, but we're excited. Love reading your bio love the last piece about married to your best friend. I think that, uh, that's probably a different type of podcast episode, but I'm a big believer in that so important, you know, you're married, but also your best friend that's key, huh?
Speaker 4:Oh, absolutely. Absolutely. We've been married for 30 years. Uh, we met in college and it's funny because when we met, we met in a college campus, um, and he was, he, another mutual friend introduced us and he, as he was walking out, he looked back and he said, something said, told him that's going to be your wife. Oh, wow. It took him two years to work up the nerves to actually ask me out. Um, but yeah, that, that's how it started. So, um, we're business partners and he's my best friends. So,
Speaker 3:Um, there there's a formula in there. Maybe we'll ask some questions around the secrets to success, but so it took them two years to get the guts to ask you out. Was that because you were like so intimidating or was it more a function of like, he just had to work up the courage because this is going to prepare me for our episode here. You're intimidating and like a tough character I'm going to have,
Speaker 4:We're so different. I'm more outgoing. He's kind of quiet. Plus he was dating someone at the time. So, um, you know, he had to work through that and then finally, uh, approached me. So
Speaker 3:Got it. Yeah. You're not, you're going to have to earn it. So he had to work for it a little bit. All right. I like it and 30 in 30 years. So did you celebrate 30 years marriage this year already? Or is it coming up?
Speaker 4:We had planned to go to Italy, but of course COVID, um, you know, messed up those plans. So we're in the process of rescheduling. So as soon as things start to open up and we feel safe, we're gonna go for it. So, uh, it was really just with the kids, small family gathering. Um, but, uh, we're going to celebrate big later in this year or 2022.
Speaker 3:Yeah. When things open up. Yeah. 30 years is a big one. So that's like, I know like isn't sir, aren't certain anniversaries. Like there's like, I don't know. There's my parents have been married for 50 plus years, but there's like, um, gold anniversaries and stuff. Am I right on that is 30, you know, that, I don't know,
Speaker 4:Five and 30, but I'm not that familiar with it. I'll have to look it up. Um, we've been so busy with growing our businesses and, and raising kids. Um, you know, we, we, we don't do a whole lot of celebrating, but we're going to have to celebrate that 30 year.
Speaker 3:Good for you. We'll circle back and get an update on that. One down there are still talk to me to net. I do obviously want to spend most of our time talking about the relevance of the work you're doing in the childcare industry and what you see happening right now. But I would love to know a little bit more about your backstory. I was reading a little bit, kind of grew up, um, in Mississippi, which, you know, at the, in that time, in that part of the country, you know, probably plays a really big role in, in kind of your upbringing and kind of career path and even how, you know, um, you approach business. Now, can you just share a little bit about where you grew up and, and the timing and what you remember about being a kid in Mississippi
Speaker 4:And the height of the civil rights movement? Um, so in Mississippi, um, my parents were divorced at a young age, so my mom was a single parent. Um, she worked several jobs, uh, to, to keep us going, but, you know, as kids, you don't know that you're poor, right? So we had a lot of love in the household. Um, we, we didn't go without anything, so she really was able to provide for us, but unfortunately she passed away when I was in ninth grade from, um, um, so, um, my brother and I'm a younger brother and I were raised by an older brother. So one of the things with her passing away so early was it really instilled in both of us, um, the app, the ability or the want, or the desire to really, really make her proud. Um, so both of us are college graduates. Um, that's why I went on to get my master's degree. Uh, so it really losing your mom at an early age, really shapes, uh, your whole perspective, you know, on life. So, uh, it really, really pushed me to make her proud. I felt like I had an angel on my side. Um, so, uh, you know, yeah, that that's was pretty much it, um, went finished college, of course met my husband, um, got married. We've got three kids, as you mentioned earlier, so
Speaker 3:Yeah. Amazing stories. So how do you, if you don't mind me asking, so as a ninth grader, you know, your brother basically took custody of you and your younger brother and the outcomes that you described. I mean, even, you know, pursuing a college degree and education and obviously education was a big emphasis for you to like, like you said, make your mom proud. Was that something that she had instilled in you from an early age? Or was that something that like you and your brother, like was a function of, of the loss and your way of kind of responding to it because you don't always see that response to tragedy.
Speaker 4:He instilled that in us, uh, school was always important. Um, you know, she only had a high school education, so she'd never had any formal college education. So she really pushed us to do well, uh, in high in college, I mean, elementary school. And so when my brother took over, he did the same thing. He didn't have a college degree as well. Um, that really pushed education. And we felt like education was our ticket out, um, an opportunity. Um, one of the things she told me,
Speaker 3:Sorry, I didn't mean to interrupt you, but do you remember thinking that as a high school student, like education is our ticket out? Like, that's why. Yeah,
Speaker 4:Exactly. And my brother, uh, instilled that in us as well as my mom, you know, things that you learn in your mind can not be taken away from you. Um, so it's an opportunity for you to move on, uh, to really, uh, make a difference in the world and to also make a change in your lifestyle.
Speaker 3:Yeah. I love that. Did you know, like during those years, I would say maybe the high school years, did you know what you wanted to be? So when you talk about education and starting to look at, you know, post high school education into college, do you remember as a person, what having dreams of what you wanted to do or be, or did that come later in life?
Speaker 4:I, I didn't know specifically Ryan, what it was, what I wanted it to be, but I knew that where I was and what I was currently living and what I saw around me was not it, if that makes sense that there would be something different. Um, for me, I didn't know what that was, but I knew it would be something different. And so as part of that, you just had kind of learned to trust the process. Um, not necessarily knowing where things are going to end up, but trust that you're moving in the right direction. Um, and I was very intentional, uh, as a, as a college student, um, everything in terms of the classes I took the majors, um, the sorority I joined the he, um, clubs I joined, I was just very intentional, um, about making sure that, uh, I made the right decisions.
Speaker 3:And when you were intentional, like, were you making decisions at that point in your life around, like, what's going to cause me to grow? What's going to instill in me some tools that I can use as I move forward. Is that what you mean? By being intentional? Everything was for purpose,
Speaker 4:Everything was, uh, for purpose. Um, everything was, uh, even from the sorority that I joined, how many members does the sorority have? What's the opportunity that as I start to grow, I may meet someone that has joined the same sorority that may help me or, or be a mentor. Um, even the clubs that I joined in college, everything was intentional. And I, you know, how, how did, how will this serve me best for my future?
Speaker 3:Yeah. I like that. And then did that also then translate, like, as you started working through college senior year, you start looking for, okay, how am I going to go apply this? Talk to me a little bit about if you could your career path, like, what did you do? What did you end up studying? What was the career path? And I think that'll take us into a little bit about what you do today.
Speaker 4:Well, I graduated from the university of Texas San Antonio, as you mentioned. And, um, I started an internship with USA, uh, which is a major military insurance company. Um, and the internship, um, well, it was a part-time job initially that started, but as I was there, I figured out that they offered internships, um, for accounting and information systems majors. So I ended up doing the internship, uh, there, uh, for probably about two years of college, which afterwards they offered me a full-time position. Um, so I ended up staying at USAA for 20 years. Um, wow.
Speaker 3:Yeah. So you went, that went from like, like, like internship paid internship, part-time
Speaker 4:Internship to 20 years of employment.
Speaker 3:Wow. Okay. So let's hear about your path with USA aid then. So you started as an intern.
Speaker 4:I started with an intern. They offered me when I graduated a full-time position. Um, I started as a computer programmer. Um, by the time I left, I was, um, a full-time analyst, uh, programmer analyst, which I was the person that met with the users of the system to actually determine what they wanted changed in it. What, what, what about the system? The it system you'd like to change. And then I was responsible for writing the specifications that the programmers would use to actually develop the code. Um, so actually when, uh, when my husband and I decided to move to Houston, um, then I became a consultant. So they allowed me to work from Houston. So I started as part-time job internship, 20 years of employing.
Speaker 3:And that was, and that was all in San Antonio. Am I right?
Speaker 4:Tonio. Then when I moved to Houston, they gave me, I started doing consulting with them, same position. Um, but I would fly down to San Antonio on Tuesdays for all of my meetings. And then virtually worked from home before work from home was a thing, uh, Houston. So I did that for probably about two to three years.
Speaker 3:Okay. After leaving USA. And so you still were connected with them still consulting. You were like the original zoom remote worker before the rest of us knew what it was. Um, and then, so like when you reflect, cause I want to talk about what you did next, but you obviously USA a huge company. I mean, still really large insurance company. I see them all the time. Like when you look back at your time, there, are there lessons learned? Like, are there things that stand out for you working for such a large employer, a big multinational company? They're probably not multinational because they're just domestic, but a huge company. Are there lessons that you've taken with you? Anything that stands out?
Speaker 4:Oh, that's a great question. I had a manager, um, that was a mentor that told me, um, even though you're not a manager, now you need to walk, look, talk like a manager so that when the position becomes available, they naturally see you in that position. And I always remembered that, um, you know, it it's about, um, the exam. People are always watching. Um, people are always watching and you, you want to make sure that you're professional and alternatives. You treat people with respect. Um, and you're a leader, even if you're not in a leadership position. And I think that has really served me well. Um, because you never know who knows someone or who may impact you later in life. So you try to always treat everyone with kindness, uh, with respect, um, and carry yourself as a leader.
Speaker 3:Yeah. I, that's a, that's a great nugget to take away because you know, the other thing that strikes me as you say that like, oh, you know, when we talk about finding new leaders, even in our organization, you know, you kind of look to the people that are already doing it. Like, you know, it's not your role, whether you're, you're helping your peers, helping your colleagues, you're stepping up, you're taking on, you know, you know, leadership roles even when that's not your title. And so a lot of times when people move into leadership, it's like a natural transition from they're already doing it without the title. So I, I liked that a lot. I also like, you know, it brings up an interesting topic around mentorship because, you know, I think, you know, a lot of times that gets lost. Like everybody gets so busy and both mentor and mentor use. I don't know if that's the right term, but I think we lose some of that nowadays in culture where everybody gets so busy and isolated, but the role of mentors in our lives is huge. Like, was that an individual that tracked along with you during your entire career at USAA? And then is that formed in any way, your kind of thoughts about mentoring others that are coming up as well?
Speaker 4:Yeah, it was, I'm actually a manager that I had. It was a, it was a gentleman that tracked along and as he got promoted. So did I, um, but also there's been so many other mentors, um, in different aspects of my life, but, um, I think you make a very good point. Um, mentors are so important, especially for young people to see samples, representation is important, uh, of themselves as they start to strive to be whatever it is that God has called them to be.
Speaker 3:Yeah. I love that. Yeah. And I think it's, you know, some of that, it's what you say, but, you know, it's, it's what you do. And maybe that's some of it as people change jobs so often now, but when there's just like this like length of time where, like you were saying, it's like, I had an opportunity to observe this individual for many years. So I saw what they were instilling in me, but then I actually observed at working out like that type of role model, not everybody gets that. So that's, that's cool. Um, then so USA, so then you did some consulting. What, what happened next for you and that'll get us to childcare eventually.
Speaker 4:Yeah, actually I moved to, uh, PricewaterhouseCoopers, uh, at that point in, in the Houston area, I moved from USAA consulting to price Waterhouse, Coopers. And, um, you know, that was, uh, uh, that was an experience like no other, it was fast paced. Um, you worked a lot of hours, you did a lot of traveling. I think it was a great opportunity, um, for me and for my family. Um, but I realized I was eight months pregnant with my third child at a project in San Francisco. I had to get a doctor's note to fly to San Francisco. And that's when I called my husband and we realized we're going to have to do something else. Cause I there's no way with three kids and a family, I was going to be able to keep up that pace of travel. Um, and the commitment required to be successful at a firm like that. And so that kind of launched us into childcare. Um, you know, our kids were attending a kids are kids and we looked at different businesses, not just childcare, um, but in ended up there.
Speaker 3:That's amazing. So you, so from the time that you kind of made that phone call to your husband, like, you know, we've got to make a change, this isn't sustainable, the work life, you know, situation that we all talk about and trying to put value on the things that are most important to us and find that right balance. Do you remember how long from that conversation? So you were eight months pregnant to the time as you started to research businesses. How long did it take you to narrow it down on the first kids are kids that you guys own
Speaker 4:Two years actually, cause our son was born. We well, three years cause I probably made that phone call and uh, early 2000, um, or September of 2000, uh, cause that's when he was born. And um, it took us two years. We opened the kids are kids in, in 2002. Now granted my husband, um, was also working in corporate America. Um, and he was working 60 hours a week. So between my travel three kids, 60 hours a week, there was just no way we were going to be able to maintain that. And our kids were attending, our kids are kids and we looked at subway, we looked at McDonald's, we looked at all kinds of franchises and business opportunities started talking to the business owner there. Um, John Carroll was his name and uh, just really my husband as a CPA started crunching the numbers once he saw the numbers is when he came back and said, I think we can do this. So it was a natural fit for us. Uh, someone looking to transition from corporate America into something that would be more flexible. Our son could be at the school, our kids could attend after-school program. So it was really a good fit for our family, right.
Speaker 3:Entrepreneurship, like for, cause you know, spending 20 plus years in corporate America, it sounds like both you and your husband were kind of on that same track. Was entrepreneurship, always something in the back of your mind that you guys thought, Hey, we would like to pursue that someday that's of interest to us or was that just brand new out of necessity, realizing you needed, uh, an environment where you could kind of call your shots, so to speak and build your schedule out.
Speaker 4:We've always been planners. So, um, we, it was on our list. I think it moved up on the list after we got pregnant with our third child. Um, but it was on the list of things, um, for us to do. We just didn't think it was going to happen so soon thought we would spend more time in corporate America. Um, but yes, we, we did, we did plan that, which we didn't have exactly what we wanted to do. Um, but we did know that entrepreneurship was going to be part of that.
Speaker 3:Yeah. It'd be able to take what you'd learned in corporate America and go apply it. So do you remember the mechanics of, so you're talking to the kids, our kids, cause this'll bring us into like the industry and the work that you guys are doing now, do you remember like for people listening to our show, you know, there's a lot of directors, a lot of owners and I think there's a lot of people that want to get into the space or figure out how can I go from being a teacher or an administrator to actually running my own center. Do you remember how you guys structured that deal? Like just maybe not even like numbers, but do you remember how you found out about it, how you structured it? Was it, you know, did you buy the building and the business? Did you guys have all the capital to do it? Cause I know there's all sorts of different paths. What do you remember about that process that you could share?
Speaker 4:That's a great question. So after we talked to the owner, uh, where our kids were, was attending, we went on and first you had to fill out an application, uh, with kids or kids. So we're waiting to hear back. And there was a certain amount of, uh, capital that you had to be liquid for, uh, to be able to build the building and the land. But once we got that approval, then we got with a real estate agent and started looking for locations. So typically in franchises, um, you have to get pre-approval on your location because it can't be close to another franchisee. Right? So we spent a lot of time looking for locations. Um, and several locations didn't work out. Um, but once we found a location, then it was getting the SBA approval. Uh, we had SBA loans, uh, for our locations, both locations. Uh, and so SBA structured the loans to be able to include the land and the building as well as working capital. Um, so, um, initially for us the initial investment on the first location, we needed about 250,000, which that really tapped into all of our investments. Uh, so we had to make this thing work, right? So
Speaker 3:It's always a big risk. Like I'm sure at that time, as you look back, was that like a period where you and your husband are having conversations, like, like we know we want to do this, we're excited about it, but it's also terrifying. Is that a fair?
Speaker 4:Absolutely. Cause you've got three small kids, so you're saving for their college education you're you know, so it's, it's really terrifying. But one of the things that we decided is we had to invest in something that was going to more than compensate for my salary. Cause our plan was he would stay in corporate America and then we were giving up my salary. I would do at least for the first five years, um, give up my salary. So, um, it had to compensate more than compensate or double my salary I was making, which was six figures at the time. So it was important that, um, we weren't just replacing my salary because you're taking on so much additional risks. Um, you know, what, if the business doesn't work out, what if you default on the loan? What if you, you know, so it, it had to more than compensate for, for my salary.
Speaker 3:Yeah. The upside had to be worth the potential trade off and risks that you were taking on from it. And so you guys opened, did you open to kids? Are kids simultaneously or were they staggered?
Speaker 4:We did the first location in 20 2002 and then the second location in 2008.
Speaker 3:Okay. And so obviously from 2002 to 2008, things went well for you. You guys got in there early days, you knew childcare from a standpoint of like our kids attended, but you were also kind of learning on the fly, did opening up a franchise, which is a curious conversation versus opening up your own independent center. And I'm sure you've talked with a lot of business owners now who also kind of try to balance like what's the right path. Did you know franchise was the right route for you? Did you explore independent or it was just, we knew kids, our kids, we believed in the model. And that just kind of made a lot of sense for you.
Speaker 4:Well, we felt like we looked at other franchises, but we felt like franchise was a less riskier option for us than going out and doing our own thing and creating our own childcare center. Um, because then the brand recognition was already there. Uh, you had support of corporate, uh, to help you. Um, but we looked at several different franchisees, not just kids or kids, but criminals and others. Um, we picked kids or kids because we were familiar with the brand. Um, and also because of the capacity of the building. Um, again, remember my husband's a CPA. So when we crunched the numbers, the number of, uh, children that could attend, uh, of course increased, uh, the amount of revenue. But it's, it's funny because he started out crunching the numbers. But when we first opened Ryan, there was a mom that was dropping her baby off her first child. He was six weeks old, off a childcare. And he happened to be dropping our son off at the same time and leaving, she cried on his shoulder, like just boom. And he walked her to the car and he called me on his drive to work and said, Nick, this is not about the money. These families are leaving their babies with us. We have to take this seriously. So probably about six weeks in.
Speaker 3:Yeah. And he realized like the money, if the money works, that's great. But it's, it's actually mission-driven work. Like there's a huge purpose. Yeah. That's a, and you guys obviously made it work like, so that first kids are kids. Then you opened a second one. Talk to me about, so you had to, I believe you've ended up selling both of those. Correct. What was, was that always part of your plan or just kind of like as the business ran and started to look at, you know, opportunities and what the best decisions were, it just made sense.
Speaker 4:It was always part of our plan, but we wanted to make sure that we sell, um, at the height of when the business was doing well. So both locations were enrolled with about 300 kids. Um, and it's funny, we had just completed Macy accreditation for both locations. Um, so the staff had been there for awhile. So we, we just really didn't want to do it at the end when, when things were kind of going down, we wanted to do it at the peak of when the, to get the most value out of the business. So that was always part of our plan to transition out of childcare. Uh, but we were in the business for 12 years. So, um, and, and we loved it. Um, I miss the people, um, um, you know, but, uh, it was great.
Speaker 3:Yeah, we were just talking before it reminds me like the audience didn't hear this, but before we started recording, you know, Francy and the marketing team were on and just got back from a national conference, talking about the people in the industry, how amazing they are. And it's, it's true that people that support and work in our industry are, we need more of'em like, I mean, that's the theme, I'm sure you hear this too. But you know, I keep seeing national headlines and it certainly resonates with all of the individual conversations we're having with our customers. Like there is just a shortage of teachers and workers in our industry. And so hopefully it's an opportunity for us to figure out some of that stuff and make this a place that people want to come work and invest. That's a side topic. Um, but so you guys sold walk me through then, like your work in the industry now, because I think a lot of like the focus, if I'm not mistaken, the net that you guys put as obviously you can be, mission-minded running childcare, you can love taking care of these kids and it's very purposeful, but if you don't run a sound financial business, you're not going to be able to do that. And so you guys do a lot of work on the accounting financial side, is that accurate with
Speaker 4:Actually we do a lot of work with childcare centers. One of the things that we're really big about is making sure that as business owners, uh, you understand your financial numbers, that that is important, um, and not only understand them, um, but have a vision for, for your future and a plan for your future and how those finances fit in. Um, one analogy that we use is when you drive a car, you have a windshield, which is a big window. You can see forward, and it's a small rear view mirror. And so a lot of times business owners are looking back through the rear view mirror to look at how it did as opposed to really understanding their finances and driving the windshield so they can pivot when they need to, when things happen to really be able to make the best data driven business decisions. So we, we help them with that. We help them with that through accounting and consulting, helping them build their financial statements, help them translate their financial statements into their financial numbers. So they understand how well their business is doing and they can make better business decisions.
Speaker 3:Yeah, that's amazing. Are there like when it comes to childcare in particular? Cause I, I do believe you work across the spectrum of industries and kind of have some specialties in different industries as well, but when, when it comes to childcare in particular, are there some common things that you see when you work with new owners around their financials that are off track or that they don't understand? Like, are there some things that you guys immediately go look at and say, Hey, we've got to put some focus on these areas. Anything that, that stands out,
Speaker 4:Um, operating your business without a budget is one, um, that we see a lot. It, again, if you set goals for your business, your budget is just a numeric depiction of whatever vision you have for your business. So in other words, if, if you're creating a budget for 2022, you expect that revenue should increase by 20%, then I should be able to see that on your budget. If you plan on increasing your revenue and your tuition based on doing a lot more marketing, then your marketing budget should be hired. You know, if you're planning on hiring additional teachers, then I should look at your payroll expense, uh, for your budget or your forecast for 2022. And I should see those numbers reflected. Um, so having a budget that is not only a vision, a numeric print depiction of your vision, but it's also a roadmap for you and your staff. Uh, it helps you prioritize your spending. It makes sure that you stay in line in terms of meet reading, reaching your goals. So a budget is just so essential to really being able to run a business.
Speaker 3:Yeah. And I bet you do run into like, you know, because it is a, I don't know if passion, you know, career, but you know, people get into childcare. At least this has been my experience because they just love the work and, and they, you know, and I'm good at that. And I enjoy that and I love that. And the business kind of takes a little bit of a backseat. So I would imagine a lot of, you know, early providers, it's not uncommon not to have a budget and it's just like, Hey, I seem to be able to pay my bills for the most part. And that's about all I know. So when you go sit down with a provider for the first time, maybe as an exercise, like, are, are there some easy ways that you can sit down and help somebody build a budget for the very first time? Like, how does that even work? Are you pulling out bank statements and tax returns and figuring out like, how do we even start to build a budget? Anything you could share about like easy tips to even start that process.
Speaker 4:Yeah, definitely. Um, we actually will have them download their bank transactions into an Excel spreadsheet for like the whole year. Um, and then we can sort those transactions, uh, label them and then really be able to create a baseline budget based on what they've spent in the past. And we do that for, for several reasons. One is to eliminate where they're spending their money now. Um, and a lot of times business owners will find that they signed up for subscriptions that they're not even using that they need to cancel. So it helps us really be able to identify where they can find some savings and where they're spending their money. So that, that creates our baseline. Um, and then they can make some decisions. Hey, it looks like I'm spending way too much money on food. Um, maybe I need to look at going to a different vendor. How can I cut my cost here? Then we can, then we can set a budget for the future, you know, time period or the year, but we really want to start with actually in terms of where you began, um, and then analyze that and then create one for, for the future moving forward and that'll drive some other decisions. You know, like I mentioned earlier, maybe your food costs is too high. You need to renegotiate with your vendor or find a new vendor. Maybe you're spending too much on supplies instead of, um, you know, going to one of the higher place supply companies. Maybe you can go somewhere else and find some.
Speaker 3:And those are the types of things that you guys will do. So as consultants, as accountants that come in and help business owners, you know, just having that different set of eyes, look at the financials and be able to say, you know, Hey, this is where we started the year or the quarter. Here's where it's deviated. So these are some of the decisions you have to make. And so just practical things like to stay within budget. And is that it? And so that's one question is those are the practical things, but then that's also the, the budget is the vehicle you guys are constantly. Do you recommend that owners are constantly looking at that budget? So like, how do I use that? If I'm a business owner, am I looking at that monthly to make sure, is it quarterly? Is there a best practice about how a budget should be used?
Speaker 4:That's a great question. Um, we recommend that you look at it monthly and so do, uh, compare it to your actions. So if you budgeted, you're going to spend$500 in supplies. Let's look at what you actually spent in supplies. One of the things we did for our school, uh, is we got our involved in creating the budget. So in October of every year, they would submit their proposed budget. And then from October to November, there'd be some negotiations between the owners and the directors. Maybe we need to lower the training costs, you know, whatever. And we'll decide on something by end of November, beginning of December for the next year. And then every month we would do a budget to actually meeting with them, Hey you, we said, we were going to spend$500. We spent 450 to$55. So we're under budget. And we, we created bonuses for the directors page based on how well they stayed within budget. Um, so, and there were some other things tied to that as well, but that's how we utilized it is we didn't create the budget and push it down to the directors. They were a part of it. Um, and then they got, once we tied the bonuses to the budget, um, they got really good at knowing their numbers. Yeah.
Speaker 3:Yeah. I bet like everybody's incentives are aligned at that point. I like that, that strategy because you get buy in and then all of a sudden it's like, they take ownership,
Speaker 4:They took ownership, they understood the budget better than I did. So, um, and she knew when she, the director was even good enough. Uh, she knew when she could start using her credit card that applied to the next month.
Speaker 3:That's amazing.
Speaker 4:So yeah, they've managed it very well.
Speaker 3:Yeah. And she would probably be like, Hey, Nanette, if you're spending this money, as that coming off my budget, you need to wait. Yeah. That's a good place to be when your director is, is holding you to that. What about like, so like what, how do you handle them? Like, let's say you're six months through a year and you sit down and look at the budget, you realize like we're nowhere close, like revenue wise. So, you know, we're talking about, this was what we budgeted for revenue. We're not even close to that. Is it, do you like recast that budget then? And so everything under that just has to change then to like, Hey, we're, we're short on what we budgeted for revenue. So now we have to go look at all the expenses and we just have to make adjustments. And that's kind of how it works, right? Like budgets a guideline. We're not there.
Speaker 4:Exactly, exactly. We actually do that quarterly. Right. Okay. At the end of the quarter, we'll reassess what the remaining of the year looks like based on those numbers. And again, everything was tied to, um, the director's bonuses as well. So if revenue was low, if we knew we were going to increase revenue by 20%, um, they would help us figure out, well, how many enrollments is that a month? Um, is that 10 enrollments a month or five enrollments a month? And then how many tours do we need to have coming through the door? Um, our goal was to have 50 tours a month. Um, our directors typically closed on about 80 to 90% of those tours if we had space in that room. So those things will drive you again. We call those key performance indicators. So we help business owners create those key performance indicators. So if the revenue is going to increase by 20%, how are we going to get there? So it's not just putting numbers out there. It's 10 enrollments a month to get 10 enrollments a month. I need to have certain number of tours a month or a phone inquiries, um, to make sure that we're tracking, um, as, as needed.
Speaker 3:Yeah. I love, you know, one of the fun things for me in our industry is listening to individuals like yourself, talk about KPIs and the importance of, you know, understanding your numbers and financials and like actually making is, you know, the, the industry and the business sustainable so that it's not just like, I love showing up and providing, you know, the services we provide, but actually as an individual and for my family, like I can make a living and I can, you know, build equity in this business and I can do both. And it's super important. Do you, do you think, like, just generally speaking for entrepreneurs that are, would come to you and say, Nanette, we're just looking for the right opportunity to go start something or invest in something like generally speaking, is childcare a place that entrepreneurs and investors should be looking. Is it a business where it's like, there's great outcomes or is it a struggle to make this type of a business work in your opinion and to do it right?
Speaker 4:I think, um, I think childcare is a great opportunity. Um, but I think it has to do, it's not about the money. Um, one of our philosophies was if you give the parents and the families, what they need and the employees, what they need, we ultimately get what we want. So, um, you can't go into it with the mindset of, you know, how much money I'm going to make is the quality of the care. Um, you know, making sure that I'm putting money back into the business to buy the supplies that the teachers need, uh, to provide the education, making sure the curriculum is there, making sure I've got great software, like pro care to track, um, tuition and make sure I'm getting my receivables done on time and I've got my finances and all of that. So, um, so yes, I think it's a, it's a great opportunity, uh, for people that, that are generally interested in providing quality care for children.
Speaker 3:Yeah. That's a good, that's a good way to describe it. Like there's, there's you gotta be the right person. You've got to have the right vision. You have to have the right approach to it, but for people that do it right, there's tremendous opportunity. We've seen that, like the image is interesting, like all sorts of new people coming into the industries. I mean, we've even seen private equity funds, you know, buying up groups of schools. And so it's a, it's an interesting time. And then, you know, obviously now coming out of COVID, I'm seeing a lot of stuff around government funding and how funds are being deployed, um, from, you know, the relief packages. So it a lot has changed in the last 18 months. It will be really interesting to see what the road forward looks like. Do you guys like for you personally in your business that, um, you guys provide accounting services consulting. So like if I'm an owner maybe as a last question and I'm like, I'm trying to decide if it makes sense for me to go bring on an outside consulting firm to help me, um, like in terms of like the value proposition of how you guys would discuss that with a potential client, how would you describe that your services are going to help me in, in what way, if I'm an owner talking to you?
Speaker 4:Well, one of the things that we say is, um, what we do is help you accomplish whatever goals it is. You have set place in your business, so we help you create the roadmap to get there. So ultimately you're going to make the final business decisions, but if you want a roadmap on how to really be able to accomplish your goals and, and identify key performance indicators. So as you're going along the way you could measure how well you're doing, and B have the ability to pivot as you need to, uh, when things don't go your way or things are not going as planned, we can help you provide the tools to be able to really manage your business. And again, I'll use that analogy of having a car with the windshield versus a rear view mirror. Um, uh, it's a lot easier as a business owner and you sleep a lot easier at night, knowing that you've got a plan in place and you have the ability to measure how things are going in case things start to go in the wrong direction. So I think COVID, and the pandemic has really taught us that planning and having an emergency fund, having a plan in place budget is really going to be key to success moving forward.
Speaker 3:Yeah. It's invaluable. And you guys Nanette within your business, do you and your husband, do you work just, I know you're in the Houston area, it sounds like. So I think, you know, you work with local business owners in the area. Do you guys work with, you know, business owners outside of that area as well? The type of services you provide, does that translate to like remote and virtual type of work and relationship as well?
Speaker 4:Yes, actually we, um, we've got clients nationwide, so not just locally, um, we've got clients nationwide, um, that we help because the concepts are the same. Um, so yes we do.
Speaker 3:Yeah. Same businesses, challenge, business challenges, like our president on the east coast, the west coast, the south, the Midwest, you name it. Right. Um, and then, so like on a personal level too, I got to ask this question because I was, when I was doing a tiny bit of research before we start our interview, I, there was a picture I saw of you. And in the background, I saw a university of Texas football on a shelf somewhere. And I was like, okay, I made a mental note of that cause I'm a college football fan, but I know you didn't go to YouTube. And then I also saw that I think one of your children went to Purdue university. And so in Indiana, if I'm not mistaken. So like where's the allegiance. Is it big 10? Is it big 12? Is it UT, is it Purdue or do you guys spread the love a little bit? How does that look for your face?
Speaker 4:Oh, so, um, it's funny. Cause my daughter wanted to go to a college where they had snow. Now that lasted a semester.
Speaker 3:I was going to say, that's not a common, like, like, okay.
Speaker 4:I was born and raised in Texas, so never saw snow. So she thought it would be great to attend a college where there was snow. So, uh, Purdue with it. But that only lasted one semester. She tired of the snow by the, by the second year. So
Speaker 3:She's like, I'll come back to the humidity in Houston at any time. Right. All right. So, so if university of Texas and Purdue met in a national championship game, no brainer, everybody in the Ray family is going to route Texas Longhorns all the way.
Speaker 4:All right.
Speaker 3:That's fair. Um, if people want to find you in a net, like, so, you know, I know I referenced your business and consulting, but just, you know, for our audience, if there's people listening that are looking into the possibility of, you know, finding an accountant to consultant that can help that knows the industry, how could our audience find you?
Speaker 4:We are TNR and county. And then I am Nanette Cole, Ray, C O L E R a Y. Um, and on LinkedIn, we're TNR and counting as well. And on LinkedIn, I am the net re MBA,
Speaker 3:The net rate and the net is two ends in the middle or, or one in
Speaker 4:Two ends in the
Speaker 3:Middle. Okay. Two ends in the middle. Awesome. And it's an important topic. I mean, we really appreciate you, you know, jumping on our show with us because, you know, there's all sorts of facets that we talk about in the industry, all different, you know, individuals and companies that are influencing, helping providers be more successful. Obviously the financial side of the business is so important and so key. And I would say, you know, maybe it's not just childcare, but I would say that that's a skillset that a lot of entrepreneurs maybe don't bring with them. You know, all the other things are in place. So having a resource that can really help them build that roadmap, like you said, is critical. So we, we loved having you on the show, appreciate you being here. And, um, you know, maybe it will be around to at some point in the future.
Speaker 4:All right. Thank you, Ryan. Thank you.
Speaker 3:Have a great day.
Speaker 2:Thank you for listening to this episode of the childcare business podcast, to get more insights on ways to succeed in your childcare business, make sure to hit subscribe in your podcast app. So you never miss an episode. And if you want even more childcare business tips, tricks and strategies, head over to our resource center@procaresoftware.com until next time.