Customer Interview: Terry Armstrong

I worked closely with Terry Armstrong during the Spring of last year to help her use SurvivalWare in her financial analysis engagements, often under considerable time pressure.  She was most appreciative of the help, and graciously agreed to spend time with Kelly relating her experience with the software.  I am happy to announce that several enhancements found in SurvivalWare version 3.0 are a direct result of Terry’s insights and “dumb questions.”

Some excerpts:

“due diligence .. financial analysis .. projection analysis”

 

What I was doing was working with a company that linked up businesses who were interested in going public with hedge funds for finances.  And what we did was we did due diligence work to assess companies’ operations and we did some past financial analysis and some projection analysis for the hedge funds to look at and determine whether this company was a viable operation for them to invest in. 

“Spreadsheet .. was just full of errors”

 

I was engaging with a company that had 250 general ledger accounts that needed to be boiled down into 24 categories of income expense categories and consistently reporting how they did versus how they said they were going to do.  So, I would be trying to take all of these account balances and push them into this 24 account format every time I was going to be reporting.  And it was crazy to do that with a spreadsheet.  It was just full of errors and I started searching on the internet for a tool that would allow me to do that and I knew it was going to be working with projections.

“signed up for it because it had a free trial..”

 

So, I found SurvivalWare on the internet and signed up for it because it had a free trial.  It had high recommendations.  Seemed to be a tool that would work for what I wanted it to do and I—so I signed up for the free trial and began to use it.

By the time my 30 days were up, I realized that it was something that was absolutely imperative for me to have to do this work and it worked really well. 

“And If I had had to do that with the spreadsheet, I would have been crazy.  It would have been absolutely insane.”

 

To take it from the raw data, from the company and put it into their spreadsheet would have been massive collating and sorting process because it had to be done 60 times.  And while we were analyzing and trying to figure out how to put their projections into a future basis, there would be lots of changes that were happening during this analysis process.  And If I had had to do that with the spreadsheet, I would have been crazy.  It would have been absolutely insane. 

The complete edited Transcript:

Interview with Terry Armstrong

January 12, 2010 – 9:30 pm ET

 

Ms. Kelly Luhring:  Tell us about your company and your specific role in the company.

Ms. Terry Armstrong:  I have to tell you a story of a company that I no longer am working with to connect it to SurvivalWare because about six or eight months ago, I stopped doing that work and I may go back to it, but right now the financial world has flipped a few things around, as you know, and what I was doing at that time is no longer available to me.  So, I’ll tell you about that story because what I’m doing now doesn’t relate to SurvivalWare.

What I was doing was working with a company that linked up businesses who were interested in going public with hedge funds for finances.  Okay?  And what we did was we did due diligence work to assess companies’ operations and we did some past financial analysis and some projection analysis for the hedge funds to look at and determine whether this company was a viable operation for them to invest in. 

Ms. Kelly Luhring:  And so, how did you find out about SurvivalWare then?

Ms. Terry Armstrong:  Well, when I was doing this work, I was having to take companies’ financial data and distill it into a specific format that the hedge funds wanted to see it in and it was a grueling process – changing significantly every time I had a new engagement.  Also if the hedge fund decided to engage the company and move forward, there would be future analysis of, “this is how you said you were going to do and this is how you did.”  I was engaging with a company that had 250 general ledger accounts that needed to be boiled down into 24 categories of income expense categories and consistently reporting how they did versus how they said they were going to do.  So, I would be trying to take all of these account balances and push them into this 24 account format every time I was going to be reporting.  And it was crazy to do that with a spreadsheet.  It was just full of errors and I started searching on the internet for a tool that would allow me to do that and I knew it was going to be working with projections.

So, I found SurvivalWare on the internet and signed up for it because it had a free trial.  It had high recommendations.  Seemed to be a tool that would work for what I wanted it to do and I—so I signed up for the free trial and began to use it.

Ms. Kelly Luhring:  Oh, great.

And after you began using it, then you decided to go from there and actually buy a package?

Ms. Terry Armstrong:  Oh, definitely.  By the time my 30 days were up, I realized that it was something that was absolutely imperative for me to have to do this work and it worked really well.  I worked with Rusty who was giving me instruction and help all along the way because I was using it for a purpose that the software was probably not intended for.  A major sorting tool is what I was using it for and to keep my sorting consistent throughout the periods.  So, I might end up with five years worth of financial information from a company in each of the five years would need to be put in and report out in these specific 24 categories and present income statements and balance sheets in these specific categories each time.  And that is what SurvivalWare did for me. 

Ms. Kelly Luhring:  Did these companies use a specific type of accounting software. 

Ms. Terry Armstrong:  Well, it varied. 

Ms. Kelly Luhring:  And so, how easy was it to learn how to use SurvivalWare?

Ms. Terry Armstrong:  It was pretty easy.  I did use Rusty a lot.  He gave me a lot of pointers as to how to do it, but it functioned very well once I got the hang of it. 

Ms. Kelly Luhring:  And so, was it easy to load data from different accounting software and do projections?

Ms. Terry Armstrong:  Well, the ease of loading from the accounting software depended on whether the client was able to get the accounting data into a spreadsheet format because I would either download a couple of times.  It works pretty well with QuickBooks, but even QuickBooks downloaded into an Excel spreadsheet and then into SurvivalWare.  So, that’s the way I always used it.  I created a spreadsheet from the accounting system and then fed the spreadsheet into SurvivalWare.  And I got to build my row maps and went from there.

Ms. Kelly Luhring:  And before were you just relying on kind of Excel?  What was your user experience with Excel and what are some of its limitations?

Ms. Terry Armstrong:  Well, I’ve been using Excel since it was Lotus and there was some product even before that, so I have been using a spreadsheet a long time – 30 years, I guess.  Mostly I’ve used Excel and I’m a pretty high level user of Excel.  For the purpose that I was using it, it would have been a nightmare to try to do this with Excel.  I could not have done it with Excel without a lot of errors, and inconsistencies. You know, to take 100 general ledger accounts and pull them into a 24 account level of structure consistently over years, past data and future data would have been an Excel nightmare.

Ms. Kelly Luhring:  And so–?

Ms. Terry Armstrong:  –And trying to figure out how to do it.  I never did it with Excel.  As soon as I saw the tasks and realized what was going to be necessary, I started looking for another tool because I wasn’t going to have that kind of patience.  I knew it wasn’t an application for Excel, you know?

Ms. Kelly Luhring:  And how was SurvivalWare able to do what Excel – what would have been a nightmare in Excel?

Ms. Terry Armstrong:  Well, once you have the account number or account name and you link it in the row map to the final account name, all you have to do is just import it and it does all that sorting for you. 

Ms. Kelly Luhring:  And so, how often were you using SurvivalWare and how long did you use it for?

Ms. Terry Armstrong:  I used it about a year.  My work had distinct phases to it.  I would spend time at the client’s site gathering a lot of information and preparing a narrative report and then I would move into the financial analysis phase.  And when I moved into the financial analysis phase, I worked with SurvivalWare constantly for two or three weeks for that client.  Once I got the financials in the format that I needed them in, then I would move into the next phase of the project which was to do some projections with regard to stock sales and purchases and then my intent was to use SurvivalWare again once the client company and the hedge fund linked up to assess their performance against their projected performance.  But, I never got to that phase of it. 

So, what I was doing during the year that I was working with SurvivalWare was intense working with SurvivalWare in that middle phase of the reporting work that I did for each client.  So, I probably had about 15 clients that I went through that process for in a year.

Ms. Kelly Luhring:  And what is it that you liked best about SurvivalWare? 

Ms. Terry Armstrong:  Well, I like its functionality.  I liked the way it took data from many different types of sources and allowed me to pull it into one piece of software.  I think it would have been outstanding and really valuable to compare your actual performance with the projected performance. 

The part that I liked the best that I used was just being able to take a massive amount of data and consistently and predictably distill it into a comprehendible format of income statement and balance sheet to analyze that data.

Ms. Kelly Luhring:  And what did you—you were pretty content in terms of the financial projections being on point and not full of errors?

Ms. Terry Armstrong:  Yeah, I found it pretty easy to use and pretty flexible so that it could accommodate a lot of different scenarios.

Ms. Kelly Luhring:  And what did you think about the graphics as well?

Ms. Terry Armstrong:  I didn’t get into the graphics very much.

Ms. Kelly Luhring:  So, was the data showing—just showing all of the past and then there’s perhaps financial information as well as the financial projections and they were satisfied with that format?

Ms. Terry Armstrong:  Yes, they didn’t want to see anything graphical.  They wanted to see the numbers in a specific format and that’s all we showed them in addition to narrative work that we did.

Ms. Kelly Luhring:  And were they satisfied with the SurvivalWare projections?

Ms. Terry Armstrong: Actually, I would take the SurvivalWare data and put it back into a spreadsheet format because that is what they required.  It would be month-by-month for five years.  So, we’re talking about 60 columns of data had to be pushed through this sieve to get it from two or 300 general ledger accounts pulled down to 24 general ledger accounts that were reported in a financial statement format – sixty times for one client.  So, I put it back into a spreadsheet format for them to look at because that’s what they wanted.

Ms. Kelly Luhring:  Oh, okay.

Ms. Terry Armstrong:  To take it from the raw data, from the company and put it into their spreadsheet would have been massive collating and sorting process because it had to be done 60 times.  And while we were analyzing and trying to figure out how to put their projections into a future basis, there would be lots of changes that were happening during this analysis process.  And If I had had to do that with the spreadsheet, I would have been crazy.  It would have been absolutely insane. 

And what SurvivalWare allowed me to do was to have a holding place where the links between the huge number of general ledger accounts that the company was using to collect their information.  And the few number of general ledger accounts such as hedge fund wanted to see all this data and allowed me to keep those links straight month-by-month through a five month historical process—I mean a five year historical process and a five year projection period.  So, it was a massive amount of data that was constantly being manipulated and reworked until it finally settled into the product that would be presented to the hedge fund in the form of a spreadsheet.

Ms. Kelly Luhring:  And so, in your opinion, how much time do you think you saved using it?

Ms. Terry Armstrong:  Oh, an immense amount of time.  Hundreds of hours per client.

Ms. Kelly Luhring:  And then, what types of businesses do you think would benefit from SurvivalWare?

Ms. Terry Armstrong:  Well, I think the projection capability which I never really got into for myself, but I looked into because I had expected it to go in that direction.  Any kind of business would benefit from that, particularly smaller businesses that don’t have any mechanism for doing that already.  Ones who aren’t projecting their cash flow, who don’t know what’s going to happen to them with regard to cash flow over the next “x” months or years. 

Ms. Kelly Luhring:  And did you feel like, Terry, it was adequate customer support?

Ms. Terry Armstrong:  Oh, outstanding.  Outstanding customer support. 

Ms. Kelly Luhring:  And would you recommend it to a friend or a colleague?

Ms. Terry Armstrong:  I definitely would.

Ms. Kelly Luhring:  Well, do you have any maybe last minute questions or comments?  Something that possibly you would have liked SurvivalWare to have done that it wasn’t able to?

Ms. Terry Armstrong:  Well, the only other thing I would add is that I was able to get help any time, day or night, and it was invaluable.  I got into this work not knowing how it was going to function and if I hadn’t had SurvivalWare, I would not have continued with it.  I would have had to get out of it because I’m not interested in pushing numbers through spreadsheets like that.  That would have been grunt work that would have been just driving me insane.

I really appreciated it and I thought Rusty was outstanding and he was always willing to help me figure out how to do things with the software that maybe somebody else hadn’t asked to do before and I really appreciated it.  I thought it was an outstanding piece of software and the price was unbelievable.  Definitely a very good value.

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Goldman Sachs: Give me my money back!

I’ve been clipping articles the last couple of months from  the Wall Street journal, the Washington Post, and other sources ever since I first heard about the “10,000 Small Businesses” initiative from Goldman Sachs last November. 

At first I thought, “what a nice gesture!”  God knows we can use the money.

$500 million (2) to help small business. 

According to the Washington Post, it first involves funneling $300 million (2) to so-called community development financial institutions.  Let me do the math – $300 million divided by 10,000 – that’s $30,000 on average to each of the 10,000 businesses to be helped.  

Excuse me if I don’t do backflips of joy.  

Then I discover that Goldman Sachs made $3.44 billion (1) in profits the 3rd quarter of 2009.  That’s about $35 million a day for a 91 day quarter.  Hmm.  So they are offering less than 10 days of profits.  Over 5 years. 

Excuse me while I stifle a yawn. 

Then  I read in the Wall Street Journal that the average compensation in 2009 will be over $700,000 (3) per person, including temps and sub-contractors.  The AVERAGE.  That’s up from $364,000 (3) the year before. 

OK, now you’ve got my attention. 

A few days later, that estimate is upped to $800,000 (4).  That is an increase of $436,000, or let’s say $440,000  rounded to the nearest 10 thousand.  $440,000.  

Remember that number. 

I start to put bits and pieces together.  The WSJ reports that “Goldman received $14 billion (5) for its trades that were torn up, including $8.4 billion (5) in collateral from AIG.”  Near as I can tell, Goldman claims 31,700 (8) employees.  That $14 billion (5) in corporate welfare equates to $441,640 per employee – or $440,000 to the nearest 10 thousand.  

I am not making this stuff up. 

My blood is starting to boil.  What about that $3,155 (9) per employee per year set aside for the “10,000 Small Businesses” initiative? (that’s right – zero when rounded to the nearest 10 thousand). 

$200 million (2) is for education.  And mentoring.  With some Goldman employees doing the mentoring. 

Say what?  

You’re going to tell us how to run our businesses?  

Mr. know-it-all investment bankers? 

The same ones who bought and sold highly complex derivatives based on valuations and projections from highly complex financial models developed by highly compensated quants who were probably high at the time. 

Look, I know a thing or two about financial models, and how fragile they can be, and sensitive to assumptions which often go un-disclosed to the users of the model output.  

And you guys bet real money on this shit?  

And wonder why we almost had a financial meltdown?!  And expect us, the taxpayers to cover your losses?! 

And now you want to educate us about how to run our businesses?  Well, Goldman Sachs, here’s a message from this small businessman: you can kiss my big, fat, ugly small business ass!!!! 

You know, what really pisses me off is that the big companies mess up royally and get bailed out, while we small guys don’t even have a voice.  We don’t get a place at the table when stimulus plans are crafted, or programs created that are supposed to help us.  We need some recognition that as the financial performance of small business goes, so goes the health of the economy.  So goddamn it, no more excuses.  This is not just about us. For the sake of the country, YOU cannot afford to muck this up! 

Goddamnit, it’s time to listen to me and the millions of entrepreneurs like me who toil in the trenches, account for all the job growth (6) in this country, yet still struggle to survive.  A second year in a row at $364,000 (3) in average compensation is not what I call a struggle to survive. 

Let’s get back to Goldman.  It is time to trash the wimpy Obama bank liability tax, which was long on rhetoric, short on pain to the banks – hence the stock market non-reaction.  According to USA Today, Goldman would have to pay $1.2 billion (7) a year in additional taxes. Or only $37,855 per employee. 

I say we claw back the full $14 billion (5) right here, right now.  It’s one thing to save the financial system from meltdown, but I’ll be god-damned if I’m going to allow my hard earned tax dollars be used to fund an increase in compensation of $440,000 per person. 

I’m  a businessman.  When I don’t make profits, I don’t pay bonuses.  Someone needs to explain that concept to Goldman Sachs.  

I’ve decided to start a petition drive to pressure Congress to act, and Goldman Sachs to do the right thing. 

Here is the text:

 Goldman Sachs Corporate Welfare Disgorgement Drive

“We, the undersigned, feel that it is grossly unfair for Goldman Sachs to benefit from the AIG bailout, and demand that this undeserved corporate welfare in the amount of $14 billion be returned to the Treasury immediately.” 

Here is the link if you’d like to show your support:

http://www.ipetitions.com/petition/gs-disgorge/

Citations

 

1. Goldman Sachs profits crush estimates

CNN.Com/World Business,  Ocotber 16, 2009 

http://edition.cnn.com/2009/BUSINESS/10/15/goldman.sachs.profits.ft/index.html 

2. Goldman Sachs, Buffett team to empower small businesses 

Washington Post,  November 18, 2009 

http://www.washingtonpost.com/wp-dyn/content/article/2009/11/17/AR2009111703983.html 

3. Goldman Seizes the Offensive on Pay

Shareholder Input Sought to Head Off Backlash Over Average Compensation of $700,000; Proxy Push

 Wall Street Journal, December 3, 2009 

http://online.wsj.com/article/SB20001424052748703735004574572363440861826.html 

4. Goldman Blinks on Bonuses

Top Executives to Forgo Their Cash Awards in Bid to Stamp Out Furor Over Pay 

Wall Street Journal, December 11, 2009 

http://online.wsj.com/article/SB10001424052748703514404574587983288950014.html 

5. Goldman Fueled AIG Gambles

Wall Street Titan’s Role Shown in Journal Study; Firm Says Problems Hidden 

Wall Street Journal, December 12-13, 2009 

http://online.wsj.com/article/SB10001424052748704201404574590453176996032.html

6. Robert Samuelson: ‘Can-do’ vs. ‘stand-pat’

Entrepreneurs could be the key to recovery 

Washington Post, January 4, 2010

 http://www.washingtonpost.com/wp-dyn/content/article/2010/01/03/AR2010010301810.html 

7. Bank tax proposal doesn’t hurt stocks

Administration wants $90B to help buttress overall system 

USA Today, January 15, 2010 

http://www.usatoday.com/money/industries/banking/2010-01-14-bank-bailout-tax-stocks_N.htm  

8. Goldman Sachs 

Wikipedia,  January 21, 2010 

http://en.wikipedia.org/wiki/Goldman_Sachs 

 9. $500 million over 5 years is $100 million per year.  Divided by 31,700 gives the $3,155 per employee per year,

 

 

Customer Interview: Deb Drexel, Accounting and Business Manager

Deb Drexel is the accounting and business manager at CivalArts,  a civil engineering and land surverying company in Longmont,  Colorado.   She spent time with Kelly recently discussing how she uses SurvivalWare and what it does for her company.

Some excerpts: 

Ease of Use

“I tried another program,  a cash flow kind of a program, and I gave it up just because it was so difficult to use.”

“I have been using SurvivalWare probably for about six or seven months.  And yes, it was very easy to learn.  I honestly don’t know what I’d do without it now. ”

Pre-built model results in huge time savings

“Survivalware is already done.  For Excel, you have to still go in and put in formulas and manipulate whereas with the Survivalware it’s just already done.  Huge time savings.”

Good value

“It’s a very good value for the money.”

Who should use SurvivalWare?

“Any business where there is cash flow needs, any other kind of construction businesses, any seasonal businesses, landscaping perhaps, perhaps even accountants where they have huge amounts of cash flow at one time of the year and the rest of the year their cash is scarce.  But, particularly businesses that are seasonal or very dependent on what the economy is doing. ”

visit their website at: www.civilarts.us

Here is the complete interview:

Interview with Ms. Deb Drexel

January 5, 2010; 4:00 p.m.

 

Ms. Kelly Luhring:  Tell us about your company and your specific role in the company. 

Ms. Deb Drexel:  We are a civil engineering and land surveying company.  And my role in the company is business manager in charge of accounting, HR, all the day-to-day business functions.

Ms. Kelly Luhring:  And how long have you been with this company?

Ms. Deb Drexel:  About 15 years. 

Ms. Kelly Luhring:  And what other sector domains do you have experience in?

Ms. Deb Drexel:  Well, we’re primarily, like, construction, but I also have a strong banking background and IT as well. I worked for IBM for a number of years.

Ms. Kelly Luhring:  And so, how did you find out about Survivalware, and what made you decide to buy it? 

Ms. Deb Drexel:  Well, I saw an ad in some magazine.  I don’t even remember what it was anymore, like a Verizon magazine or something, advertising it.  And I checked out your website and thought it looked very simple to use. 

I use QuickBooks for our day-to-day accounting activities and financial reporting, and it seemed like it was very similar to QuickBooks in just the ease of use.  I have tried another program, and it–I won’t mention what it is.  But, it’s a cash flow kind of a program and it’s–I gave it up just because it was so difficult to use.  And there wasn’t any mechanism to be able to tie the QuickBooks accounts into it like there is with Survivalware. 

Ms. Kelly Luhring:  And so, you’re pretty familiar with QuickBooks.  How about Excel as well? 

Ms. Deb Drexel:  Yes, very familiar with both.  I’ve been using QuickBooks for, oh, my goodness, 13 to 14 years, and Excel for about the same or longer. 

Ms. Kelly Luhring:  And what, in your experience, are some of the limitations that you find in Excel and how does it compare to Survivalware?

Ms. Deb Drexel:  Survivalware is already done.  For Excel, you have to still go in and put in formulas and manipulate whereas with the Survivalware it’s just already done. 

Ms. Kelly Luhring:  And so, in that respect, it cuts down on a lot of time?

Ms. Deb Drexel:  Yes, that would be a correct statement.  Huge time savings.

Ms. Kelly Luhring:  And that is important to you, and that’s something that you think is important for your job?

Ms. Deb Drexel:  Yes, I would say that’s probably one of the most single biggest factors when I decided to make the purchase for Survivalware, that was probably one of the biggest selling features. 

Ms. Kelly Luhring:  Was it easy to learn how to use Survivalware?  How often do you use it and for how long have you been using it?

Ms. Deb Drexel:  I have been using it probably for about six or seven months.  And yes, it was very easy to learn.  I honestly don’t know what I’d do without it now. 

What I kind of needed, what my main focus was — was trying to get a handle on cash flow, number one, but also to try to create a dashboard of key performance indicators that are important to me and to our industry to follow and track.  So, that’s the biggest thing that–the biggest help with. 

Ms. Kelly Luhring:  And so, about how often do you use it?

Ms. Deb Drexel:  I would say several times a week. 

Ms. Kelly Luhring:  And did you learn it on your own or with help from LSI? 

Ms. Deb Drexel:  There was a tutorial or something in there, and I kind of learned it on my own with the tutorial.  And I think there was a free web class or something I attended and got a little help from that, something on your website.  I don’t remember at this point. 

Ms. Kelly Luhring:  And so, in your opinion, is it easy to load data and do projection?

Ms. Deb Drexel:  Yes, it is. 

Ms. Kelly Luhring:  And what do you like best about Survivalware?   

Ms. Deb Drexel:  Probably just the ease of use and that it seems fairly stable and that I can get what I need pretty quickly. 

Ms. Kelly Luhring:  And how has it helped you–you said earlier, you know, you don’t know what you would do without it now.  How has it helped you in terms of, you know, transforming or maybe evolving in your current business?

Ms. Deb Drexel:  The biggest thing that it’s done for us is just to help keep track of the cash and to be able to project out, let’s say, three to six months where you think the cash is going to be based on some assumptions that are happening with the economy and what’s going on in your industry and that sort of thing. 

Ms. Kelly Luhring:  And so, can you think of maybe any specific examples where it’s really come in useful in terms of, if you hadn’t had an accurate projection, maybe something could have gone wrong? 

Ms. Deb Drexel:  Well, let’s just say given the current economy and the fact that we’re in the construction industry, we went from having a very profitable year in 2008 to being not so profitable in 2009. 

When I took a look at it back in April, it gave me the ability to be able to project out where I thought our cash was going to be–well, about six months.  And that really helped so that we could do what we needed to do as far as making staff cuts and expenses and all that sort of thing so we weren’t in as much of a bad spot as we could have been.    

Ms. Kelly Luhring:  And do you feel like there is adequate customer support?

Ms. Deb Drexel:  You know, I’ve never really had to use the customer support.  Based on my experience, I really haven’t had a need for it too much yet. 

Ms. Kelly Luhring:  And do you think that other people who might not have the same experience as you do in terms of IT would be able to become as familiar with the program and be more–be as comfortable with it?

Ms. Deb Drexel:  Well, I think it would take a little bit more work if you didn’t have an IT background.  But, I think if you have worked with Excel and if you know–are at least an intermediate QuickBooks user, I think you could probably figure it out. 

Ms. Kelly Luhring:  And would you recommend it to a friend or a colleague?

Ms. Deb Drexel:  Yes, I would.

Ms. Kelly Luhring:  And what types of businesses do you think would benefit from Survivalware?

Ms. Deb Drexel:  Any business where there is cash flow needs, any other kind of construction businesses, any seasonal businesses, landscaping perhaps, perhaps even accountants where they have huge amounts of cash flow at one time of the year and the rest of the year their cash is scarce.  But, particularly businesses that are seasonal or very dependent on what the economy is doing. 

Ms. Kelly Luhring:  Can you think of any other last minute comments or questions? 

Ms. Deb Drexel:  I think it’s a very good value for the money, and that was a big factor in my deciding to purchase it.  It’s a very good value for the money. 

Ms. Kelly Luhring:  In terms of being, you know, pertinent in terms of being in construction and engineering, can you think of maybe anything that you would need to make it more personalized towards your company?

Ms. Deb Drexel:  No.  I’ve kind of been waiting.  I don’t know if your new version has come out yet that will allow me to plug in more key performance indicators that I’m looking for that might be applicable to my industry that nobody else really cares about. 

Ms. Kelly Luhring:   For example? 

Ms. Deb Drexel:  we have to keep a real strong eye on equity per employee, because if the equity goes too low it limits our ability to be able to obtain loans, lines of credit, that kind of thing from banks, and our ability to grow when the economy does improve.  So, we have to track some other kind of funky things like that that are more specific to our industry. 

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Customer Interview: Mike Wilkerson, CFO of Dominion Equipment Parts

Mike Wilkerson is a savvy CFO who knows the importants of doing cash flow projections. 

Here are some excerpts from an interview that took place January 10,  2010:

Does what any small business needs to do

“I Googled cash flow or something along those lines and SurvivalWare came up and so I said, well, boy, it’s certainly cheap.  It’s $500, not a lot of risk involved.  I’ll try it.  It probably won’t do what I need it to do, but it’ll be a start in the right direction.  And really, it’s been more than I expected.  For the cost, it’s got a lot of little bells and whistles and does exactly what any small business needs to do which is projecting where the cash is going and where it’s going to be at any certain point in time and that’s critical, obviously, if you need to borrow money from the banks.”

Gain a competitive edge when requesting bank loans

“The key is — anytime a small business can present financial statements and cash flow statements to the bank’s liking –  that separates you from a large group of their customers because a lot of times, they’re not that sophisticated.” 

“Banks love balance sheets and income statements, but they really like cash flow statements and they like to see that everything ties down and balances back.  SurvivalWare does that.”

A visual tool to show how things play out

“It is a tool where a lot of times owners or companies and people within organization, they see if you sell a $30,000 piece of equipment, they see $30,000.  They don’t see that maybe it’ll cost you $20,000 to buy that piece of equipment, that you gotta pay some people, that you’ve got some overhead and then, at the end of the day, you don’t end up with $30,000 in cash.  So, it’s been, like I said, it’s been a very visual tool to show how things play out, where the money all flows to.”

Works great with MAS90 accounting software

“We’re using a fairly large company called Sage Software and they market a product called MAS90 that we converted to probably in 2004.  We moved from a DOS-based system to MAS90.  It gives you a cash flow statement, but just no way to do cash flow projections.  The beauty is that we’ve been able to export those financial files out of MAS90 in a CVS format into SurvivalWare without having to re-input all that data.”

Visit their website at: http://dominionequipmentparts.com/

Here’s the complete interview:

Interview of Mr. Mike Wilkerson

January 10, 2010 – 5:00pm ET

Ms. Kelly Luhring:  Why don’t you go ahead and tell us about your company and your specific role in the company?

Mr. Mike Wilkerson:  My role is the Chief Financial Officer and we have four operating entities here involved in heavy equipment in some way.  We’ve got a company called Dominion Equipment Parts and we distribute about 10 different product lines nationally through a warehouse distribution system and we’re selling parts and rubber tracks and hydraulic hammers and things of that nature to equipment dealers and end users. 

And we’ve got another company called American Track Carrier, where we import a piece of equipment from Japan and we sell it to end users and dealers or we sell it to an affiliate company, American Track Rentals and who, in turn, then rents this equipment to equipment dealers and end users in the natural gas pipeline industry.

And then we’ve got a fourth company, Dominion Credit, which finances used construction equipment for equipment dealers.  So, collectively, we’ve got separate—we’ll we’ve got separate four—we’ve got separate LLCs for those four companies and we operate those individually.  But, it’s some–.

Ms. Kelly Luhring:  –Okay.

Mr. Mike Wilkerson:  And so, I was going to say, it’s somewhere in the neighborhood of 30 to $40 million in revenue. 

Ms. Kelly Luhring:  And so, what other industries do you have experience in?  How long have you been with this current company?

Mr. Mike Wilkerson:  I’ve been with this company almost 10 years.  My previous experience has been in insurance in the financial industry, financial services industry is in banking and auditing.

Ms. Kelly Luhring:  And so, how did you find out about SurvivalWare and what made you decide to buy it?

Mr. Mike Wilkerson:  Well, basically, it was kind of on a whim.  You know, I needed something to do some projections that didn’t require that I have all the formulas right in Excel to make sure that it [unintelligible] and that I didn’t miss something.  So, I was looking for something – a tool that, you know, would work internally for us and it would project to the banks well. 

And so, I Googled cash flow or something along those lines and SurvivalWare came up and so I said, well, boy, it’s certainly cheap.  It’s $500, not a lot of risk involved.  I’ll try it.  It probably won’t do what I need it to do, but it’ll be a start in the right direction.  And really, it’s been more than I expected.  For the cost, it’s got a lot of little bells and whistles and does exactly what any small business needs to do which is projecting where the cash is going and where it’s going to be at any certain point in time and that’s critical, obviously, if you need to borrow money from the banks. 

So, I guess—is it your dad that I have been talking with? Rusty?

Ms. Kelly Luhring:  Uh huh.

Mr. Mike Wilkerson:  Okay.  Yeah, and, you know, he’s been great to work with and helpful as I have come across problems or issues related to the software.

Ms. Kelly Luhring:  And what type of accounting software are you familiar with or are you—have you used in the past or are you still using?

Mr. Mike Wilkerson:  Well, we’re using a fairly large company called Sage Software and they market a product called MAS90 that we converted to probably in 2004.  We moved from a DOS-based system to MAS90.  So, we’ve been on that since 2004.  And it gives you a cash flow statement, but just no way to do cash flow projections.  So—and the beauty is that we’ve been able to export those financial files out of MAS90 in a CVS format into SurvivalWare without having to re-input all that data.

Ms. Kelly Luhring:  Great.

And then, what is your user experience with Excel and what are some of its limitations?

Mr. Mike Wilkerson:  Well, you know, Excel is a great tool.  I have some knowledge.  I am certainly not by far a super user or anything, but you don’t know what you don’t know.  Rather than trying to take the time and learn Excel and all its features and how to build a cash flow model with all those formulas, it’s already been done for me.  You know, here’s what I’m asking for and what I was looking for and was something that probably a lot of small businesses are looking for.  So, nothing unique.  So, rather than take the time to learn Excel to the degree I didn’t know or did and didn’t do, I just decided to invest that time in an outside cash flow software package. 

Ms. Kelly Luhring:  And in your opinion, was it easy to learn how to use SurvivalWare?

Mr. Mike Wilkerson:  It was fairly easy.  I mean, you know, again, like I said, Rusty’s been very helpful in making that transition and it’s like anything else, you’ve got to stay, you know, you can’t put it away for a month and pick it back up in another month or two.  You kind of forget where you were or how you did things.  So, it was a—it wasn’t a difficult transition, but once you learn the background for the model behind some of the things in SurvivalWare it becomes pretty easy.

Ms. Kelly Luhring:  And so, how often do you use it?

Mr. Mike Wilkerson:  I use it at least every month.  I update monthly and we close our month end for the companies.  I go ahead and export those files into SurvivalWare and then see how that plays out for the remainder of the year.  And, of course, here at year end, it’s—I’ve been using it fairly often as we go and look at 2010 and how we think things are going to play out. 

Ms. Kelly Luhring:  And how long have you been using it for?

Mr. Mike Wilkerson:  Probably maybe less than a year I would say.  I can’t remember exactly, but somewhere in that year timeframe. 

Ms. Kelly Luhring:  And when you were going through the learning process, did you take advantage of the webinars that were offered or did you rely mostly on the customer support from Rusty?

Mr. Mike Wilkerson:  I think I did one webinar, but mostly it was having Rusty walk me through how to import the files because really that’s the most difficult part is importing the files, but once you do it and you get it mapped, then it’s all—then it’s a matter of just understanding, okay, if I change this number, where does it fall out?  What else changes?  So—but, Rusty was probably a bigger help in getting the files exported into SurvivalWare and then understanding, was there a programming issue?  Something that I didn’t see?  Or didn’t understand?

Ms. Kelly Luhring:  How easy is it to load data and do projections?

Mr. Mike Wilkerson:  It is—like I said, once you do it a couple times, it’s very easy.  The hard part is getting the first time doing it and mapping all the accounts within SurvivalWare.  But, you know what?  After that, it’s just a matter of loading a CSV file and it shows up on all the financials.

Ms. Kelly Luhring:  And now, do you use it for all four different LLCs?

Mr. Mike Wilkerson:  I use it for three of the four LLCs.  I really don’t need it for the finance company. 

Ms. Kelly Luhring:  Why is that?

Mr. Mike Wilkerson:  We just don’t have a need for projections and all of that with—we know what the portfolio is and we know what it spits off as far as cash.  So, it’s not as critical.

Ms. Kelly Luhring:  And what do you like best about SurvivalWare?

Mr. Mike Wilkerson:  I think, you know, two things.  It’s fairly intuitive once you get over the initial learning curve.  Two, the cost is relatively inexpensive for I think a pretty powerful software program.  You know and the key is really to the bank’s liking and anytime a small business can present financial statements and cash flow statements, that usually separates you from a large group of their customers because a lot of times, they’re not that sophisticated. 

Ms. Kelly Luhring:  And so, what has been missing from your previous financial projections or accounting software that SurvivalWare provides?

Mr. Mike Wilkerson:  SurvivalWare does what we didn’t have before, and that’s a projection tool.  You know, anybody can put projections down in Excel for sales, but the key is cash.  You can book receivables all day long but if you don’t collect, your cash isn’t going to happen.  So, that’s where SurvivalWare has filled in a gap that we currently had that our other systems didn’t have.  So, like I said, it’s filled a void that was missing.

Ms. Kelly Luhring:  And can you think of maybe a specific example and maybe one of the companies where having that projection really helped kind of, you know, maybe, oh, no, I can speak the word in French, but not in English.  This is terrible.  That you could avoid any kind of shortfall?

Mr. Mike Wilkerson:  Well, I mean certainly in this economy in 2009 and going forward in 2010, I have been able in, obviously in 2009, to lay those projections out, show the owners of the company who are not accountants, and show them where things are going to be.  So, we kind of know ahead of time, generally speaking where we’re going to be.  But, this puts some specific criteria to it. 

What type of loss?  What type of gain based on sales projections are we going to be?  How much cash is that going to throw off and where are we going to be with our line of credit with the bank?  Are we going to be maxed out?  Are we going to have available—availability in the line to make additional purchases?  So, that’s been real critical in 2009, being able to say, here’s what we’re going to look like in the next three months, in the next six months.  And then, if we take those projections out and say, okay, it worked in ’09, I proved that to you, here’s—let’s take our projections for ’10 and here’s where they’re going to be.  Where do we need to improve?  Where do we need to kind of watch things to make sure that we don’t get in trouble?

Ms. Kelly Luhring:  And would you say you have noticed a difference and maybe the profitability or in the satisfaction of the company?

Mr. Mike Wilkerson:  I don’t think this is just a tool.  It certainly is not going to make profits or create losses. But it is, again, it is a tool where a lot of times owners or companies and people within organization, they see if you sell a $30,000 piece of equipment, they see $30,000.  They don’t see that maybe it’ll cost you $20,000 to buy that piece of equipment that you gotta pay some people, that you’ve got some overhead and then, at the end of the day, you don’t end up with $30,000 in cash.  So, it’s been, like I said, it’s been a very visual tool to show how things play out, where the money all flows to.

And when you have historical information to prove that, and then to project those out, you know, it’s not numbers you’re making up.  It’s again, trying to show people where that dollar goes and how it flows through to the bank account at the end of the month.

Ms. Kelly Luhring:  And would you say that the bank has been satisfied with the visuals that are provided by SurvivalWare and just the financial projections, in general?

Mr. Mike Wilkerson:  Yes they have.  They’ve been very pleased with our numbers.  We’re dealing with lending requests in the millions of dollars.  Banks just aren’t going to lend you millions of dollars on an idea or on past performance.  They want to see how this is going to play out.  So, it’s been very beneficial in that fact that we’ve got the numbers.  We know—we’ve taken the time to input them and see how this thing is going to play out, so that it’s not just an idea, it’s an actual—there’s actual numbers to support the idea and that it does cash flow.  Banks love balance sheets and income statements, but they really like cash flow statements and they like to see that everything ties down and balances back.  So, and SurvivalWare does that. 

Ms. Kelly Luhring:  Great.

What types of businesses do you think would benefit from SurvivalWare?

Mr. Mike Wilkerson:  Do you know what?  I think any small business that’s got a sales revenue that may be – whether it’s seasonal, whether it is static, I think any small business, you know, should invest in some type of software that shows cash flow projections, so that it is like your personal household budget.  You gotta know where the dollars go so at the end of the month, you’re like, God, what happened?  Where did the money go, you know?  I got paid.  But, I don’t have any money in the bank account.  Well, you have to go through that laundry lost of things, besides the mortgage and the utilities, you gotta figure out, well, how much did I eat out?  You know?  You’ve got to do the same thing with the business is, you know, where does all this money go?  And it’s not—it’s a limited supply.  So, I think any small business that wants to (one) find out where their dollars are going and (two) you know, how can they grow that business?  You know, SurvivalWare certainly seems to be a good tool at a reasonable price.

Ms. Kelly Luhring:  And do you feel like there’s adequate customer support? 

Mr. Mike Wilkerson:  Yeah, I mean, I’ve always called and Rusty’s always answered the phone and, you know, if he can’t get back with me, he’s prompt in getting back with me at a later time. 

Like I said, it exceeded my expectations for the price that we paid.  I really didn’t expect it to be that great of a tool.  I didn’t expect to get the support that I’ve gotten.  So—but, in being right up in northern Virginia, you know, it’s kind of nice.  It’s not somebody across the country.  So, it’s worked out for a lot of reasons. 

Ms. Kelly Luhring:  And would you recommend it to a friend or colleague?

Mr. Mike Wilkerson:  Yeah, I certainly would, yeah, in a small business roundtable.  Certainly, how do you do things better?  How do you do things smarter?  I would certainly recommend it to someone that had the same need that I did.

Ms. Kelly Luhring:  Great.

Can you think of any last minute comments or questions?

Mr. Mike Wilkerson:  You know, the only couple of things that come to mind is as far as improvements and that’s really somewhere having a minimum cash balance.  Right now, I don’t know that there’s something in the system that allows you to say, I want to maintain a balance of $100,000 at all times.  So, you kind of have to play around with those numbers to get back to where you need to be. 

And then, I think there is a limitation on term notes in the system to five, where we probably have 10 or 12 that I’d like to input in the system, but I can’t do it.  I have to lump it all together and then, make my own assumptions as far as what those amortization schedules look like.  But, for my initial purposes, it’s worked very well.

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Customer Interview: Kirk Allen, AlphaGraphics

I read recently that there are over 900,000 franchise establishments in the U.S.  With support from a franchisor like AlphaGraphics, I can see why.   I’ve heard the CEO of AlphaGraphics express time and again the idea that the success of the franchisor depends entirely on the success of the individual franchisees.  The management team at AlphaGraphics takes a long term view of the business, and they genuinely care about their franchisees.  They don’t just talk the talk, but walk the walk through SurvivalWare and other initiatives.

We, of course, are pleased as punch that AlphaGraphics has adopted SurvivalWare as a financial reporting standard  They have been a great company  to work with these last 5 years, and we look forward to continued success working together the next 5 years and beyond.  If I was going to open a franchise business, they would be the first ones I would talk to.

Check out their website at www.alphagraphics.com

Here is an in-depth interviw with Kirk Allen,  National Director of Financial Services for AlphaGraphics, who manages the SurvivalWare project.  Kirk explains what they are trying to do to help the franchisees better run their businesses, and how SurvivalWare is a key part of that effort.

Interview with Mr. Kirk Allen

December 30, 2009; 4:30 p.m.

 

Mr. Kirk Allen:  I work for AlphaGraphics and I’m the National Director of Financial Services.  One of my main tasks is helping the regional teams to drive bottom line profitability with our franchisees.

It’s a franchise-based network, and our centers are individually owned.  And so, it’s real important to help our centers maximize their investment.  And so, that’s one of my roles.

My main task is helping centers maximize their profitability.  If there are some centers that are struggling, specifically working with them through some of the challenges that they’re facing, trying to identify, you know, kind of what the root cause is and what changes they need to make whether or not it’s sales related or cost related.

Our franchisees are required to submit financial statements to us on a monthly basis.  It’s the 30th day after the end of each month they’re required to submit them.  And starting January 30th, each of our owners will be required to submit those statements to us via Survivalware. 

I got a Bachelor of Arts in accounting from Point Loma Nazarene University and also have a number of designations, one of which was I got a stockbroker’s license along the way and some other things.

We found out about Survivalware as a company, I believe it was, five to six years ago.  The Director of US operations had come across Philip Campbell’s book on cash flow.  And just through having read that, he got in touch with Rusty and Philip. 

Ms. Kelly Luhring:  And how long have you been working with AlphaGraphics?

Mr. Kirk Allen:  I’ve been working with AlphaGraphics coming up on 12 years.

I’ve probably visited about 35 or 40 percent of the centers at one point or another over 12 years.  And while I don’t directly support any states now, at different points in time, I was responsible for 14 different states for providing the regional work. 

So, one of my roles had been the regional operations manager prior to my role now.  And I worked directly with the franchisees trying to help them with various things in their business.  That would be in their “point of sale” system, working with them on pricing, reviewing financials, those types of things. 

About 7 or 8 years ago, myself and another individual developed a financial overview tool which we took a considerable amount of time.  It was something where we would take their financial statements and input by hand into this tool.  And through the tool, it would create all types of benchmarks for them, compare them to the profit leaders of our network. 

And it was something that we would do a couple of times a year.  And it was just a critical part of our support process, something that me and this other individual, Danny Wilson, spent quite a bit of time helping just to develop it. 

It was an Excel based tool.  And while it did a good job, you can imagine, we were really limited to how often we could look at financials, because in order to use that tool we actually had to take a financial statement key it in by hand. 

So, one of the real appeals to Survivalware was being able to export it directly from QuickBooks, and then import it into Survivalware.  And of course, there’s the one-time mapping that you do, to map things from that QuickBooks file into a common chart of accounts. 

Sometimes there are things that people do that’s unique to their centers and their financial statements, yet Survivalware allows us to have a common chart of accounts so we can evaluate all of our franchisees on a common basis. 

Something that kind of played into that decision was, one, really making the process a lot easier.  Rather than it being kind of a painstaking, you know, key entry of the financial statements, that it was rather a process where the franchisees import it.  They submit it to us and we’re able to run reports where we can look at all of our centers and have a discussion or review that. 

And in about a day, Survivalware allows us to review all of them where really that would have been something that would have taken, you know, a month or two to do previously.  Now, we can do it in one day. 

Ms. Kelly Luhring:  How many different locations does your network contain?

Mr. Kirk Allen:  Right now, we have roughly 235 centers in the US that are open and operating.  We have other ones internationally in Brazil and in the UK and other places. 

The US centers are the only ones using Survivalware at the moment.  We’ve talked about getting some of our other franchisees internationally set up.  We just have not done that yet. 

We’ll run a vital metrics report.  We know where the benchmarks are and we’re able to real quickly determine where our franchisees should be, the progress they’re making, and adjustments that need to happen in order to help them improve. 

The actual running of the report and reviewing it does not take a significant amount of time.  It’s having the individualized conversations with our regional teams on, what are things that we can do to help out, what is the action plan for each of the centers?  That’s a process that we spend a day doing each month.

Ms. Kelly Luhring:  And how much time would you say that you’ve saved using Survivalware versus the Excel tool that you helped design beforehand?

Mr. Kirk Allen:  It’s not just the time. It’s really less about the time that’s been saved and more about this: rather than looking at somebody’s financials twice a year, we’re now able to review financials on a monthly basis.  We’re able to identify trends that are going on really immediately. 

For instance, this past year with the recession, we were able to help identify concerns early on.  And we were able to have conversations with the franchisees and help them through that process on things.  Those converations would never have happened previously.

So, it’s more about the increased level of support that we’re able to give and about being able to review just the health of our network, on an in-depth basis – on a monthly basis as opposed to a semiannual basis.  There’s no doubt about it, the time savings is very significant.  Before we would have a whole team of people doing it. That time is being replaced with actually providing support.

Ms. Kelly Luhring:  So, for example, what kind of trends that maybe you would be able to catch early on that you could remediate with Survivalware, if you could think of maybe a specific example that has come up?

Mr. Kirk Allen:  Sure.  

We have benchmarks for labor, you know, our sales for full time equivalent on a monthly basis, three month, a 12-month trend.  And so, labor this year, with sales pretty much all over the place having gone down, we’ve been able to identify on a case-by-case basis what centers need to readjust their business model specifically in labor. 

It’s also helped out through the equipment decision making process and determining, are they at a place where they really need to add additional equipment.  And then, specifically the cost of goods sold on different products, it’s a way of helping to make sure they’re in line with where they should be.

We have 103 different vital metrics that we’re looking at.  That’s a lot. 

About 95 percent of our franchisees are using QuickBooks.  So, that’s worked really well for our network.  There are some franchisees that use other types of accounting software. 

We’re just in the process of moving to version 3.0 of SurvivalWare.  And every version is becoming more user friendly with the different accounting systems out there. 

So, in regards to Excel, you know, one of the things that sometimes comes up is this: franchisees, quite frankly, will ask the question, “What is it that I can do in Survivalware that I can’t do in either QuickBooks or exporting a file from QuickBooks over to Excel and then creating my own custom variables?”  For us, with Survivalware, there’s two things. 

One is that all this is customized for us.  And so, we have an unbelievable amount of data calculated each and every month and all those things are done automatically.  And charts can be quickly done, whether it’s a monthly basis, a quarterly basis, etc.  It has become very easy to do that.

In addition to that, within our network, our vital metrics, – all 103 different benchmarks – our franchisees can compare themselves to the rest of the network.  So, looking at their sales per full time equivalent, they’re able to see last month where did they rank against the rest of our network.  Were they at 35th percentile, the 45th percentile?  And where did they rank over the last three months and where did they rank over the last 12 months?  That’s something they just can’t get anywhere else other than SurvivalWare. It is how are they doing against the rest of our network. 

We also show our median, our 12 month median, each and every month.  We update our profit leaders on a quarterly basis.  Those are things that you just can’t get from QuickBooks, you can’t get from an Excel template. 

Survivalware is really the only place that our franchisees are able to get that.  A franchisee may say — if they’re not using it — they may say, “Well, we’re improving.  We’re doing well.”  It really opens up their eyes when they see exactly where their center–and how their center is doing against the rest of the network, and even more importantly, how they’re doing against our profit leaders in our network.  Because now all of our franchisees are wanting to improve their bottom line, and it helps to know what our most profitable centers are doing.

Those are our important things.  What I like the best about Survivalware is being able to allow our franchisees in our vital metrics reports to see exactly how they rank against the rest of the network, in the 103 vital metrics that we have. And then also what their trends are. 

From the standpoint of the franchisor, the thing I like the best is it allows us to quickly identify a problem and be able to work with those owners before it becomes too late.  From our standpoint, it will sometimes be the difference of helping a center making it through a difficult process.  We are able to help them because we’ve identified the issues early on.

Ms. Kelly Luhring:  Would SurvivalWare be a good fit for other businesses? 

Mr. Kirk Allen:  I think it could be something that would be very helpful, specifically business where there’s a lot of different units whether it’s a franchise network or a business that just has a lot of different outlets.  I think Survivalware would allow them to identify trends and identify the common characteristics of their best centers, and then provide those benchmarks to the other units to set goals to strive for. 

Ms. Kelly Luhring:  –And so, was it easy to learn how to use Survivalware? 

Mr. Kirk Allen:  –Well, the first version was actually not easy.  The first version was a huge step forward for us, but it was not the easiest process.  A significant step forward was made with version 2.0 (Fall 2008) and now with version 3.0, it’s a very user-friendly interface.  From my standpoint, it’s fairly easy to use.

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Customer Interview: JR Samples, Chief Accountability Officer

JR Samples has spent 30 plus years in sales and business ownership, and currently runs a consulting firm called Accountability Partners.  He uses SurvivalWare to make it easy for his clients to provide financial data that he can analyze in a common format.   The participants in one of his CEO peer groups no longer have to laboriously (and sometimes inaccurately)  key numbers into an Excel template.  Instead they just export their P&L and Balance Sheet to CSV files and email them to JR, who loads the data into SurvivalWare.    Reports and graphs are presented at meetings held 3 or 4 times a year, and the participants share experiences and try to figure out how the best performers do as well as they do.

Learn more at JR’s website:  http://www.accountabilitypartners.com

Here is the interview:

December 24, 2009

2:00 PM

 

 

Ms. Kelly Luhring:  So, why don’t you go ahead and introduce yourself, tell us about your company and your specific role in the company?

Mr. JR Samples:  Hi, I’m JR Samples.  I’m the CEO of Accountability Partners, and we are a management consulting firm assisting firms on revenue growth and personnel development.

Ms. Kelly Luhring:  And how exactly do you go about that, actually?

Mr. JR Samples:  Well, we many times get engaged with clients that are seeking to take their company up to the next level and looking at substantial increases in revenue and/or they’re profit challenged, and I come in to look at the dynamics of that and how to get some of that working better to increase the profitability cash flow and ultimately the valuation of the company.

And then, we look at where the organization needs to go and who the players are and what development they need or what roles need to be filled that we’re looking forward to and work on a very hands on role in that context.

Ms. Kelly Luhring:  So, do you do–what kind of companies or organizations do you work with?

Mr. JR Samples:  I principally am working with firms less than 20 million in revenue, and many of which are technology oriented, whether that’s from software development, professional services, technical services, managed services, software as a service, principally in the technology side, but much of the revenue analysis, sales analysis, sales process, marketing process is consistent across many industries.

Ms. Kelly Luhring:  And so, what kind of other maybe sector domains do you have experience in?

Mr. JR Samples:  It’s principally been the technology sector that is servicing any number of financial industries, manufacturing, distribution.  I’ve also done a lot of work in the financial recovery sector doing financial audits and recovery services for organizations, as well.

Ms. Kelly Luhring:  And what kind of interested you or got you started doing this?

Mr. JR Samples:  Well, I’ve spent 30 plus years in sales and business ownership, and half of that’s been with Fortune 500 firms and half of that’s been as an owner or partner in my own small medium business.  And so, I’ve had the benefit of running my own business and knowing the challenges associated with that, and I’ve also been exposed to the best practices of Fortune 500 firms who really do have in many cases, in my experience, excellent resources and processes.

And it’s really the Fortune 500–we sometimes think Fortune 500 firms, they have all of these resources and how wonderful it must be to have all of that, and that’s true.  But yet, at the same time, the Fortune 500 or 1,000, Fortune 1,000, they’re actually the largest users of management advisory services.  So, when you think of Accenture, Mackenzie, it’s really still these Fortune 1,000 firms that are tapping into professional business advisors.

So, through my work as a division president for a Fortune 500 firm, I had some exposure to processes, if you will, that were really just fantastic.  And so, what I decided to do in 2005 was kind of work with small medium business owners, of which I had an experience and a passion for, and bring some of those best practices to help them in their growth as an organization as well as the principal shareholders.

So, I try to blend a lot of the best practices of sales and marketing and of personnel development, and yet blend that into the culture that has been created within a privately owned company.  And that’s sometimes a challenge, but that’s–but, at the same time, you can really see the impact of this right away.  So, it’s very rewarding from that standpoint.

Ms. Kelly Luhring:  Great.

And so, how did you find out about SurvivalWare and what made you decide to buy it?

Mr. JR Samples:  Well, one of the things that I work in–on in both my–as my focus on revenue growth and personnel development is I do run CEO peer groups for the technology business owners.  And so, we get together three times a year and work on our business best practices.

And one of the areas that we share are financial data.  So, what’s different about our peer group, which is kind of important to understand the use of SurvivalWare, is I was tired of–you go to trade shows and you see other–talk to other business owners and you ask how’s business and, oh, business couldn’t be better, things are fantastic.

And you know that that’s only true for a very small percentage of everyone, but yet, you don’t really as a small business owner sometimes, you don’t know who you can trust and you don’t know who you can really go to to get good advice.  And so, as we put our groups together, one of the things that we insisted on was transparency on the financial numbers.

So, we don’t care whether somebody’s making money or not, that’s not a requirement of being in our group.  But, you do have to have transparency because we don’t want to sit and listen to somebody tell us how wonderful their business is and then look at the financials and not see a correlation between what they’re telling us and the results that are really happening.

So, it’s a membership only group by invitation or referral.  And we really kind of work as a board of directors in that sense of each other, but really getting into the numbers.

And when you get into the numbers, that’s many times where you can really find out how people are getting their results and detail behind that.  So, it really takes your conversations to a much deeper more effective level as a business owner when you can really see the financial results somebody’s getting.

And so, I hate to go off on a long diatribe here, but I’ll continue, is there’s a lot of benchmarking studies.  And you can always kind of see where your results line up against this invisible peer group.

But–and that’s fine and that’s wonderful.  But, other than that, there’s nobody you can reach out to and say, hey, tell me how you got those kinds of results.

And so, what we do is put people in a place where we share those results, and yet they can look across the table and talk to the person that’s generating those results.

So, in the context of that, we–I needed a process and a set of software that would allow me to do the comparisons between organizations.  And so, I had set up a fairly extensive Excel spreadsheet of where I would send a spreadsheet out to the clients and the clients would fill out the input section of the spreadsheet and send it back to me.

And then, I would run a variety of macros and create my comparison charts and my graphs and some of those things.  And it worked, but it was a little kludgy for me and it was a little kludgy for the client.  And 50 percent of the time, the data that came back wasn’t accurate and took a lot of time.

So, I was speaking with a friend of mine at Comp TA who had recommended on a different initiative entirely Judy Shream [sp].  And in my conversations with Judy, I was also explaining what I do, she said you need to talk to Rusty Luhring.  And I said, great, why do I need to talk to Rusty Luhring.  And she said, well, he has a set of software that does exactly what you’re doing presently.

And she didn’t necessarily say whether I should drop what I was doing or not.  She was basically making a professional referral.

So, I got in touch with Rusty, I think about a year ago.  And we began using the SurvivalWare product for our data capture and our comparisons.

And from that standpoint, it’s really been a huge improvement both for myself and my clients in that at this point, all they need to do is send me a CSV file out of their–most of them are on QuickBooks–out of their QuickBooks.  So, there’s really no additional spreadsheets for them to fill out and that sort of thing.  They click a couple buttons, get their file and send it to me.

And then, I receive that file and import the data into SurvivalWare where we’ve already set up the mapping to make sure that we’re comparing apples to apples.  So, a lot of the work that I do with the firms is get all the work in the right buckets.

And so, SurvivalWare allows me to do that–do those conversions, if you will, so the client never has to worry about changing their chart of accounts or changing anything about the way they do their business.  SurvivalWare itself takes their data and puts it into the areas of comparison that we use in our peer group.

Ms. Kelly Luhring:  Okay.

So, basically, you had mentioned that you got back some inaccurate information.  And what–how were you able to tell that it was inaccurate?  And just in general, what is your user experience with Excel and what are some of its limitations?

Mr. JR Samples:  I’m fairly adept at Excel. One of the biggest differences for the clients is they never have to fill out anything.  I just take an export of their data, which for them is fairly simple to do–we’re talking minutes–and I don’t have to worry about them keying data into a spreadsheet–and doing that whole translation themselves from their financials into my spreadsheet and hoping they put it on line 12 instead of line 13 and that they entered $12,000, not $21,000.

And so, it eliminated all of those kinds of things from the client standpoint.  So, then from my standpoint, it certainly made it easier in that basically from meeting to meeting, it’s very simple to then import that and run the comparison reports that we’ve set up to prepare for the meetings.

Ms. Kelly Luhring:  And was it easy to learn how to use SurvivalWare, and how often do you use it?

Mr. JR Samples:  I would say it’s been a fair learning process.  The support that I’ve gotten from SurvivalWare has been phenomenal.  I only use it every other couple of months when my meetings are occurring.  And so, that means I’ve in essence used it three or four times.

And so, I haven’t quite myself gotten my own rhythm down.  Bu –let me tell you this – it’s far less onerous on me using SurvivalWare than my previous process.

Ms. Kelly Luhring:  So, in a lot of ways, it really has saved you a lot of time?

Mr. JR Samples:  Oh, yeah, without question, yeah, yeah.

Ms. Kelly Luhring:  And just if you could guesstimate, about how much time do you think it has cut down on?

Mr. JR Samples:  Probably 50 to 60 percent.

Ms. Kelly Luhring:  Wow, okay.

And when you were learning SurvivalWare, did you kind of jump in on your own, or did you have help from–learning SurvivalWare from Rusty at all?

Mr. JR Samples:  Yeah.  No, I had a lot of support from Rusty and the SurvivalWare staff.  They were very patient, assisted me significantly with webinars and sharing Go To Meetings and sharing back and forth and just been–actually did some customization that I was looking for, so just has been very pleasant and competent in helping me.

Ms. Kelly Luhring:  And so, how easy would you say is it to load data and do the projections that you need and have all of the graphics, etc.?

Mr. JR Samples:  ­The loading of the data is exceedingly simple, the importing of the CSV files, in my case, the matching process–so, for sake of argument, somebody might add some new accounts that have to be mapped someplace within my matrix – very simple to do, very easy to do.  The reports are excellent.  The few unique needs that I had, Rusty was able to assist me with in a very timely fashion.  So, all of that has just really assisted me in my preparation and in my deliverable back to my peer clients.

Ms. Kelly Luhring:  And what do you like best about SurvivalWare or what’s something that you really appreciate that it can do?

Mr. JR Samples:  Well, I mean, really in its entirety, the fact that for what I do in collecting the data, analyzing the data and presenting the data, it’s just–it’s simplified my life significantly, and as importantly, it’s simplified my clients’ process for providing me the data.  So, if I had to pick one, I would probably pick the fact that it’s simpler for my clients to get me the data.  If I had to pick one, that would be it.

But, all of the rest of the stuff that I used to go through that I don’t have to go through or has been significantly improved is also very important and material.

Ms. Kelly Luhring:  And so, how have your clients responded when–you said you have these meetings, kind of like the board of directors, and when you’re able to all sit down and kind of look and analyze the data, I mean, what was their reaction when you kind of brought in this new software?

Mr. JR Samples:  They’ve been very pleased with it, as well.  Principally, from their standpoint, the deliverables that Rusty was able to help me with were somewhat similar to what they’ve been used to seeing.  So, from their standpoint, the output hadn’t changed dramatically.

What changed for me was the ease of use of presenting that output, if you will.  What–from the clients’ standpoint, in my particular case, they love the fact that they didn’t have to sit down with an Excel spreadsheet, because many of them were not necessarily conversant with that, and fill out rows of data.  They could tell their controller to send me the CSV file and they show up at the meeting and get to look at the important stuff.  So, they’ve been–that’s just one other thing that they didn’t have to worry about in their busy lives.

Ms. Kelly Luhring:

And so, ultimately, would you recommend SurvivalWare to a friend or a colleague?

Mr. JR Samples:  Oh, yeah, absolutely.  It’s–depending on the kinds of things that they’re wanting to have or doing, there’s a lot of demand nowadays for business intelligence KPIs, key performance indicators.

And this SurvivalWare is a great method for not necessarily just the small companies, but certainly the small companies that don’t have literally tens of thousands if not hundreds of thousands of dollars to invest in this KPI business intelligence type of thing to get, in many cases, the core data that they need in running their business on a day-to-day basis.

Ms. Kelly Luhring:  And also following up that line, what types of businesses do you think would most benefit from SurvivalWare?

Mr. JR Samples:  Any business – a non for profit business, for profit businesses.  It’s really any executive even within a business unit versus a standalone company that’s trying to measure financial data and performance.

So, one of the areas that SurvivalWare addresses is that we can use non-GL information.  And so, we can have and do have the numbers of staff in different categories, whether that’s administrative, development, customer support, sales.  And we can do various analysis of the productivity based upon some of those things.

So, really anybody that’s measuring and managing people and numbers can find some value in using this.

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In defense of business

During one of my early morning breaks from the computer,  I read the Schumpeter column in the Economist (12/19/2009), and found that I strongly agreed with the point they were trying to make.

They start with a quote from the obscure (maybe not to their learned audience – but to me) Henry Hazlitt, “one of the great popularizers of free-market thinking, who once said that good ideas have to be relearned in every generation.”

They were referring to the fact thay they thought business was a good idea, and that the current generation seems to be losing sight of that.

They lament that “critics of business dominate the discussion of corporate morality,” and go on to say “For all too many people it is taken as a given that companies promote greed, crush creativity, and monopolise power.”

(Excuse the spelling – they are British, after all).

They offered three arguments:

“The first is that business is a remarkable exercise in co-operation..  It is worth remembering that that the word ‘company’ is derived from the Latin words ‘cum’ and ‘pane’ – meaning ‘breaking bread together’. “

I didn’t realize the derivation of company – but how true is that.  It is all about gaining co-operation and building trust – among employees, suppliers, customers, lenders, and sometimes the public at large.

The Economist continues, “Another rejoinder is that business is an exercise in creativity.”

These guys are so on-target.  I see it every day in my business, in my industry, and in my customers’ businesses.  People constantly experimenting with new processes, new products, new techniques in a continuous quest for improvement.

The third one is one I never thought of, but leave it to the editors of the Economist to come up with this:

“A third defence is that business helps maintain political pluralism.”  You’re excused for a quick run to the dictionary.  Basically it is a good thing.  I think it means tolerance of diversity in democracy.  The majority rules, but the rights of all are protected.

“Companies have a difficult enough job staying alive , let alone engaging in a ’silent takeover’ of the state.”

Amen to that!

“Only 202 of the 500 biggest companies in America in 1980 were will still in existence 20 years later.  Anti-capitalists actually have it upside down.  Companies actually prevent each other from gaining too much power, and also act as a check on the governements that would otherwise be running the economy.  The proportion of the world’s governments has increased from 40% in 1980, when the pro-business revolution began, to more than 60% today.”

They conclude by exhorting us hard-headed business people to take a few minutes from our busy days to stick up for ourselves, and make these arguments.

“.. the price of silence will be an ever more hostile public and ever more overbearing government.”

Count me in.

Here is their website: www.economist.com

7 Port USB Hub painlessly plugs into existing 4 port USB hub

I feel like a new man.  I had ordered the 7-Port hub from Staples (www.staples.com) for $42.00 a couple of months ago.  Staples has me hooked as a customer because they issued me a credit card with a generous line of credit several years ago.  So I didn’t shop around – you can probably do better on price.  I got their private label brand.  As usual, I was in a hurry.  I was putting together an order for office supplies and computer accessories such as a cordless keyboard/mouse combo for my laptop – so I decided to address a long standing annpyance.  I have been constantly plugging in USB devices and un-plugging them to make room for others.  I found it a deterrent to do things like charge my iPhone and synch it up with my PC, or load up the latest videos. 

I finally got around to installing the hub this morning, and it worked instantly on my Windows XP computer.   I unplugged one of the cameras from the 4-port hub I had previously installed.  Everything just seemed to work!  I’m not used to that with computers.  Including my iPhone and my recently installed bike helmet cam I actually have 4 video cameras plugged into it right now.

Keep the books, or pay someone else to do it

That is a famous line in Philip Campbell’s book,  “Never Run Out of Cash.”  (www.neverrunoutofcash.com)  Philip equates keeping the books in a small business to doing the dishes at home.  If you let them pile up, bad things happen.

So yeah, I had been letting things slide while devoting 110% of my time to product development, customer support, and marketing.  Not to mention building the SurvivalWare “team” – the core of the company’s creativity.  Its DNA in more ways than one.

Things seem to be going really well.  We’ve got a major franchise customer(Alphagraphics www.alphagraphics.com) who has adopted SurvivivalWare as a system standard.  After January 1, all franchisees will have to report their numbers in SurvivalWare in order to be in compliance with their franchise agreements.   It has been a real boon to their field support staff – a tool to understand how their franchisees are doing compared to everybody else – to identify problems early, and spread best practices.

Separately, we have had total strangers buy SurvivalWare right off the website without needing assistance to make the buying decision, or in getting started.  This is happening even before the website makeover due for completion in January, not to mention the “How to” videos, and the “ramp up” in PPC advertising still to come.  All very encouraging.

The release of SurvivalWare Pro in January should really extend the usefulness of SurvivalWare .  It allows consultants and power users to customize dashboards, KPIs, and reports for clients.  The Report Customizer could turn out to be the killer app that puts SurvivalWare on the map.

So, back to this whole “keep the books up-to-date” thing.  I recently paid the price for doing a sloppy job.  First, I bounced a check about a month ago.  It was totally preventable.  I took money out a few days earlier than I should have.  Luckily the bank covered it, so I didn’t have the embarrassment of re-assuring a vendor or employee.

The good news is that I am finally doing something about it.  I’ve contracted with OSI Business Services to do my book-keeping and accounting on an out-sourced basis.  We’ve had two conference calls and have started the process.  What is so good about them (besides ganging up on you on the conference calls to make sure things get done), is that they make all the processes so efficient.  Most of the transactions will be automated – bill paying, receipt of bank and credit card statements, etc.  I may upgrade my shopping cart software so that the website sales are entered into QuickBooks automatically.

And they will do a cash reconciliation for me DAILY.  That’s what I’m talkin’ about!

So think how embarrassing it was for me to sit down with the SurvivalWare Cash Planner yesterday morning, while everyone slept, and I paid my penance for neglectful record keeping.  I was setting up a file for a first cut at a cash requirements analysis for next year.  The last one I did was in September to get me through to the end of the year.  This is when I assembled my “team” and made commitments to them through the end of the year.  And sure enough it worked.  I was able to set aside worrying about cash for three months, confident that I had a workable plan.

There are a ton of things I want to do in the coming year, and I need to phase things in very carefully due to cash contraints and the uncertainty associated with new product introductions and new marketing initiatives.

So anyway, the opening screen wants me to enter my current cash balance.  And I realize I don’t actually know what it is.  At least I finally had online banking set up due to prodding by OSI.  So I checked the balance online, and the last 15 to 20 days of transactions to see if I could determine how many checks had been written but not cashed.  Note:  all this would be totally un-necessary of I had been keeping the books up to date.  Like I said, I’m paying my penance.  Also, if you find yourself in a similar circumstance, maybe I can help you claw your way out.

The next step is to go through the stack of bills and enter each one into SurvivalWare, including the intended pay date.  I entered all the payroll and sub-contract plans for the next four months.  I entered the OSI fees, and other significant payments.

Then I printed out a check register for the last three months to look at the pattern of regular payments.  This is where it gets really embarrassing.  I noticed a check to the Company Corporation for $410 in November.  I get a bill from them once a year, usually in August I think.  I always pay them late because I figure what a racket they have – they help me set up a Delaware Corporation for about $250 years ago, and then prey on my fear of tax filings to to charge me a “Corporate Registrar” fee year after year after year.  So you can imagine how I felt when I saw another check to them for $410 in December.  I just assumed it was still due because I always pay it late.

As an entrepreneur – and especially one who knows the importance of cash, good record-keeping, and purports to be an expert on cash flow planning – I committed an unforgivable sin.  It is only by ‘fessing up to it in public that I can begin my recovery.  If I were Japanese, I would commit hari kari.  I have besmirched the cash flow brotherhood.  I grovel in your presence for forgiveness.  I’ll have to figure out some public act of contrition.

I wonder if they’ll send it back, or whether they’ll just credit my account.

Anyway, I intend to chronicle the switchover to OSI Business Services over the next few weeks, and also how I am using SurvivalWare and some elbow grease to cope with everything during the transition.  It is too early to say I recommend them – but so far I have been really impressed with OSI Business Services.  If you can’t wait, call Bill Gerber at 1-888-858-9919, and tell him Rusty sent you.  www.osibusinessservices.com

Coming Up Next

How to do a cash requirements analysis with the SurvivalWare Cash Planner.  I’m putting Luhring SurvivalWare on the equivalent of the Facebook Diet.  I lost 15 pounds on the Facebook diet by simply posting my weight on Facebook for everyone to see every day.  Then I refined it into the SurvivalWare Diet by counting calories, tracking exercise, and keeping good records.  Plus doing the proper analysis.  And I lost another 20 pounds.  Ok, 17 1/2.   The last 30 days have been tough.

Likewise I am going to post on this blog the progress Luhring SurvivalWare makes in cleaning up its act and eating its own dog food.

Customer Interview: Stan Touchstone, 18 year small business veteran

Stan Touchstone has been a customer for some time.  He is the owner of Kissimmee Valley Feed and Ranch Supply in St Cloud, Florida – just outside Orlando.  I find his story inspirational.  He is one of the nicest people I’ve met.  Yet he has this dogged detrmination to learn and make himself and his company better.  I am honored to be considered part of his financial team. 

About the customer interviews:  my daughter Kelly recently joined the SurvivalWare team, and is based in Paris, France.   She is a marketing assistant, and reports to Rosalie Cushman who is based in Southern California.  Kelly created and manages our Facebook page and Twitter account, and is an understudy to our key video guy, Sam Sabzehzar.   She is doing a series of 10 in depth customer interviews to help us tell the SurvivalWare story.  She has been living in France for 2 years now, and convinced me to open a representative office there (which is “”in process”) based on the incredible contribution she is making to the company and the fact that she’s willing to work for slave wages if we pull it off.  Phone and internet service is great in Paris, so it is almost like she is next door.

My thanks to Stan and to Kelly.

Here is a link to Stan’s Website:

http://www.kissimmeevalleyfeed.com/index.htm

Here are some excerpts:

The Value of having a pre-built model

“I guess the biggest positive for me in SurvivalWare is all that Excel type of work of setting up equations and trying to get to the thing, it’s already done for me..”

Uses it monthly

“I upload my data on a monthly basis.  I’m in the program using it at least once or twice a month.  Basically what I like to do is set up projections and then go in on a monthly basis and kind of review where I’m at physically with the projections that I’ve made in SurvivalWare, and then make appropriate changes in my business if I see something’s not right.”

Helping to manage cash

“Yeah, one thing is I have a line of credit that I use to fund purchasing inventory.  And being able to make my projections–my–the business that I’m in, because of the weather here in Central Florida, is very cyclical.

And November, December, January and February, I’ll do 65 percent of my annual sales in those four months.  And even though I may have a great cash balance in the spring, after those four months of a lot of business and earning a lot of profits, I chose not to completely pay off my loan for inventory not all in one month, of which I could, but I cash flowed it out over several months and I used SurvivalWare to help me determine that would be the best thing to do.”

Improving Profits

 “I also use SurvivalWare to look at my expenses and figure out how to massage those so that through those summer months, I was able to for the first time earn profits during those three months during the summer, typically months that were–I operated at a loss.  So, SurvivalWare allowed me to be able to look at the numbers and predict and do what ifs on a very quick basis to make decisions in my company so that I now have 12 months operating in the black instead of eight months operating in the black and four months at a loss.”

SurvivalWare is something different

“I like just about every aspect of SurvivalWare.  I like the graphics on the home page.  It’s something different.  It’s easy to look at and you know which spot you need to go to just by the picture.”

Small business wisdom

“I’ve learned some wisdom from him (Rusty) on operating the businesses.  It’s always great to have kind of a–whether he realizes it or not, he’s part of my financial team.  I’ve kind of got a team of men and different people and business operators that I rely on their comments and their council, and he’s part of it, whether it he realizes it or not.”

eLearning would be really nice

“Maybe the only thing that I could see is possibly if Rusty could put together some type of demonstrations that I could look at online in my own time–.”

Here is a transcript of the interview in its entirety:

Interview of Mr. Stan Touchstone

By Ms. Kelly Luhring

December 22, 2009

1:15 PM

 

Ms. Kelly Luhring:  Hello.

Mr. Stan Touchstone:  Hello, Kelly.

Ms. Kelly Luhring:  How’s it going?

Mr. Stan Touchstone:  Doing just fine.  How are you this morning?

Ms. Kelly Luhring:  Good, good.  It’s actually afternoon.

Mr. Stan Touchstone:  Excuse me.

Ms. Kelly Luhring:  And where are you now?  You’re located in Florida?

Mr. Stan Touchstone:  Yes, St. Cloud, Florida, just outside of Orlando.

Ms. Kelly Luhring:  Okay.

I actually have a friend who’s from–where is she from again?  I can’t remember.  It’s somewhere near Orlando, though.

Mr. Stan Touchstone:  Okay, yeah.  Big–got a lot of places.

Ms. Kelly Luhring:  Uh-huh.  Okay.

Why don’t you go ahead and tell us a little bit about your company?

Mr. Stan Touchstone:  Okay.

My company name is Kissimmee Valley Feed and Ranch Supply, Incorporated.  I’ve been in business for 18 years.  And I started out primarily selling cattle feeds and supplying ranch supplies to the area cattle ranches that are in Central Florida.

It’s mainly a large commercial type business, but in the last few years, 10 years or so, it’s evolved into a large retail outlet where I supply any type of animal feeds and supplies for any kind of animals from zoo animals to commercial agricultural type animals, dogs, cats, any of the zoo animals.  We supply feed to the major attractions here in the Orlando area for their exotic animals, and then all the related supplies that may go along with that.

We do about $1.7 million worth of business a year.  It is a high volume type sales but low margins that’s associated with this business.

So, it’s–even though the sales figures appear high, the margins are usually pretty tight and slim on it.  So, we have to very–be on top of our financial statements monthly to make sure that we’re not spending more money than we make.

Ms. Kelly Luhring:  Okay.

And so, what–how did it end up evolving over the years?  Why did it change more into–why did you decide to deal more with retail and–?

Mr. Stan Touchstone:  –Well, it wasn’t really a decision.  It was an opportunity.  In the Central Florida area–it was 19 years ago, which it still is today – we have some of the largest cattle ranches in the Southeast are here.  And matter of fact, the largest ranch in the United States is in our county.  It’s over 300,000 acres in land size and very large in cattle numbers.

But, these large vast lands around here right next to a large urban area such as the Orlando market the last 10 years or so with all the growth and influx and people into the state of Florida, our little town and surrounding towns around Orlando has become [unintelligible] communities for this major metropolitan area.

And with those come families and smaller land tracts.  We have a lot of horses in our area that people use for pleasure and their competition type endeavors.

And so, that’s provided new opportunities for me as a store being able to meet those needs of those folks supplying good quality dog foods and horse feeds and small animal feeds as well as the new attractions that have built in the areas that all include animals into their theme of their park.  So, it’s just–it’s kind of been a huge trend in the United States in the last 10 or 15 years of these urban areas on the outskirts of these large cities as people that live in the middle of these towns, as they earn incomes and more monies, wish to move out of that very concentrated life into a little bit more open space and enjoy their animals and buy–you know, want to have animals for their personal enjoyment and satisfaction.

So, that’s–I’m trying to meet those needs is what it’s evolved into the last few years.

Ms. Kelly Luhring:  Okay.

And then, tell us a little bit – what’s your specific role in the company?

Mr. Stan Touchstone:  Okay.

I own the company.  I started it from scratch, as well as most small business owners know that you have many titles and wear many hats.  I do all the accounting work–well, I say that.  I do have a certified public accountant that does the majority of my work, but the day-to-day billing, invoicing, coding payables, paying bills, payroll, all those things I do as well as delivering feed, customer service, cleaning restrooms, office work, building displays within the retail environment of my store.

So, I, you know, I play every major role there is in the business, I do it.  I do have what–three other employees that help me with this.  But still, we are a–we’re a small business and you do those kind of things day-to-day.

And so, that’s–I don’t really have a primary role other than just to see that everything works in benefit of each other and we all work towards a common goal of trying to make sure we earn enough money to pay our bills and provide for my personal goals, paying for my [unintelligible] retirement just like anyone else.

Ms. Kelly Luhring:  Okay.

And what sector or domains have you–do you have experience in before getting into this business, for example?

Mr. Stan Touchstone:  Well, I have grown up in rural areas of the South on small farms, and then kind of as I finished high school, went to college at the University of Florida and earned an animal science degree, managed a couple of large cattle operations before I opened the store for myself.  These other cattle operations were for other owners, and I worked in a management role with them–And went to several different schools for learning how to operate business profitably and always been kind of fascinated with the accounting side of business and the financial side of it.

And so, that’s–everything that I know financially and have learned how to operate spreadsheets and use this information that I’ve got from SurvivalWare, I’ve had to learn on my own.  I’ve had no formal training in it.

My formal training has been in how to meet the nutritional needs of livestock and animals and to use those animals to provide income for [unintelligible].  It’s kind of a funny way how these things wind up, but I am fascinated with the financial side of the business and like to look at numbers and been involved in–with volunteer organizations from the financial management [unintelligible].

So, it’s kind of just been a personal thing of mine over the years–.

Ms. Kelly Luhring:  –Okay–.

Mr. Stan Touchstone:  –Again, everything I’ve learned I’ve had to learn on my own.

Ms. Kelly Luhring:  And how did you find out about SurvivalWare and what made you decide to invest in it?

Mr. Stan Touchstone:  I found out SurvivalWare from Philip Campbell and Never Run out of Cash.

I stumbled across the book and Philip through the internet just in my personal searches and things that I like to look for, and I purchased his books and read his books.  And through that, that’s how I learned–found out about SurvivalWare.

Ms. Kelly Luhring:  Okay.

And what made you decide that it was a good investment?

Mr. Stan Touchstone:  Well, I–it was a, you know, a risk, try something.  It seemed fairly inexpensive for what I was gonna get.  And it was–looked like it would provide a need.

When you get cash flow projections from your accountant, they’re always kind of, at this point, looking backward, so to speak.  And with the SurvivalWare information, I could actually do projections, cash projections out into the future and be able to look–utilize past data that I had paid for from my certified public accountant in financial statements and balance sheets and be able to use those actual numbers in simple transactions to be able to predict out into the future what my cash balance–what my business would look like in a year’s time if I followed these steps.  And that’s what my primary interest in SurvivalWare was all about.

Ms. Kelly Luhring:  Okay.

And what other type of accounting software have you used in the past or are still using or just have experience with?

Mr. Stan Touchstone:  Well, I really haven’t, and that may sound kind of odd because I’ve had my financial–my CPA that actually prepares my financial statements.  Just from a legal standpoint and from an IRS standpoint, I’m the kind of person who likes my Is dotted and my Ts crossed, so to speak.  And so, I manage my businesses by the books and I like everything to be accurate.

So, I didn’t rely on my own personal use of software because I felt like I would be making mistakes because I have no formal training in it.  But, I would–we developed a system with my CPA that he was able to generate me very accurate financial statements on a monthly basis for a reasonable cost.

I think he used the Peachtree Accounting Software.  And so, I let him kind of worry about the mechanics as long as I got the reports at the end of the month on a timely basis so I could look back and manage my business and see where things needed to be changed going into the future, building histories and things like that.

So, I really have nothing to compare SurvivalWare to other than a yellow sheet of paper and a pencil and an eraser and did my own little financial calculations and projections on paper.  So, that’s–.

Ms. Kelly Luhring:  –Okay–.

Mr. Stan Touchstone:  –In the past.

Ms. Kelly Luhring:  And so, in your opinion, was it easy to learn how to use SurvivalWare?  Did you learn it on your own or with help from the Learning SurvivalWare Company?

Mr. Stan Touchstone:  Majority of it was on my own.  There’s still some of it that I feel like if I touch a button, the thing’s gonna disintegrate.  But, that’s personally.  I’ve just got to practice with it and use it much more.

And I really have not had any formal training like in Excel.  Most training I’ve had in Excel is I went down to the local bookstore and found a book that was on my version of Excel and kind of mustered through that the best I could.

But, I do like SurvivalWare because it’s–the equations are already built into each line, and all I need to do is just put a number in there and know that at the bottom of the column, it’s gonna come out right.  And so, it’s–and it may be the best kind of learning is where you sit down and do it yourself and learn how to operate it yourself instead of working with things.

It takes a little bit longer to do that, but once you’ve been through it yourself and have–rely on no one but yourself, you tend to–at least for myself, I tend to focus on what I’m doing a lot harder and make sure that I do learn it so I don’t have to keep repeating the lesson, so to speak, each time I want to do something.

Ms. Kelly Luhring:  Okay.

And so then, your user experience with Excel, in your opinion, what are some of its limitations and how does it compare to SurvivalWare?

Mr. Stan Touchstone:  Yeah, I would be very poor on answering this question appropriately because I really do not know how to use Excel that well at all.  I’d be the first to say SurvivalWare has really helped me and speeded up the process for me because it already has the calculations done for each line and each column. 

And I basically had to take the time to set the lines up so that at the bottom of the column it’s totaled out right.  So, as far as labeling each line if it’s expenses or ever what portion of the financial statements according to each one of those little brackets in SurvivalWare, getting it set up right.

And then, I don’t have to worry about doing the mathematical calculations or setting the computer up so it does it for me.  It’s already been done.  So, it’s very easy and fast for me with no financial software training.

Ms. Kelly Luhring:  Okay, great.

Mr. Stan Touchstone:  [Unintelligible] SurvivalWare for me.

Ms. Kelly Luhring:  I’m sorry?

Mr. Stan Touchstone:  The–I guess the biggest positive for me in SurvivalWare is all that Excel type of work of setting up equations and trying to get to the thing, it’s already done for me in SurvivalWare.

Ms. Kelly Luhring:  Uh-huh, uh-huh.

And how long have you been using SurvivalWare?  And what is your use?  How often do you upload data or just do your projections?

Mr. Stan Touchstone:  I upload my data on a monthly basis.  I’m in the program using it at least once or twice a month.  Basically what I like to do is set up projections and then go in on a monthly basis and kind of review where I’m at physically with the projections that I’ve made in SurvivalWare, and then make appropriate changes in my business if I see something’s not right.

SurvivalWare numbers are still coming up true and just, but my business numbers are not correlating with it.  And I look and make the changes in the business necessary to achieve the things that I want to achieve.

Ms. Kelly Luhring:  Okay.

And can you think of any specific examples of where you’ve seen that you need to make a change in your business numbers and how you’ve done that, just something, I don’t know–.

Mr. Stan Touchstone:  –Yeah, one thing is I have a line of credit that I use to fund purchasing inventory.  And being able to make my projections–my–the business that I’m in, because of the weather here in Central Florida, is very cyclical.

And November, December, January and February, I’ll do 65 percent of my annual sales in those four months.  And even though I may have a great cash balance in the spring, after those four months of a lot of business and earning a lot of profits, I chose not to completely pay off my loan for inventory not all in one month, of which I could, but I cash flowed it out over several months and I used SurvivalWare to help me determine that would be the best thing to do.

Instead of cashing out, it was better for me to pay a little bit of interest, extra interest on the money and then just pay the loan back out because in the summertime and the months of June, July and August, we’re very slow in the business.  And I just didn’t want to rob the business of any type of a cash balance or cash support knowing that in those three months in the summer that it was gonna be pretty difficult to operate each month profitable.

I also use SurvivalWare to look at my expenses and figure out how to massage those so that through those summer months, I was able to for the first time earn profits during those three months during the summer, typically months that were–I operated at a loss.  So, SurvivalWare allowed me to be able to look at the numbers and predict and do what ifs on a very quick basis to make decisions in my company so that I now have 12 months operating in the black instead of eight months operating in the black and four months at a loss.

So, those are the kind of things that it’s really helped me–able to better massage and really work my business so that it operates profitably 12 months out of the year.

Ms. Kelly Luhring:  Great.

And so, do–what’s one of your favorite things about SurvivalWare?  Do you like the graphics or just the ease of use?

Mr. Stan Touchstone:  I like just about every aspect of SurvivalWare.  I like the graphics on the home page.  It’s something different.  It’s easy to look at and you know which spot you need to go to just by the picture.

I like how easy it is–we–Rusty helped me set up with my accountant the way they send me the month-end financial data via email in Excel spreadsheets, and then I–once we got things set up with Rusty, I was able to just–only just takes just a few minutes to download monthly financial data into the SurvivalWare software.  And just in minutes, I get very valuable reports that really help me manage my business.

Those are the–how easy it is, the graphics, all those things, I really like the whole software.  It’s a great tool.

Ms. Kelly Luhring:  Okay.

And going on with that, do you feel like there’s adequate customer support?

Mr. Stan Touchstone:  Yes.  Rusty’s always been great when I have questions of answering the questions.  He’s supported me.  We’ve had a couple of issues of making sure we get different editions operating appropriately, and he’s been able to solve all those quickly and properly and been very much a pleasure to work with.

I’ve learned some wisdom from him on operating the businesses.  It’s always great to have kind of a–whether he realizes it or not, he’s part of my financial team.  I’ve kind of got a team of men and different people and business operators that I rely on their comments and their council, and he’s part of it, whether it he realizes it or not.

Ms. Kelly Luhring:  Okay.

And would you recommend SurvivalWare to a friend or colleague, or what types of businesses do you think would benefit from the software?

Mr. Stan Touchstone:  I think any small business could benefit from this software.  And, yes, I do recommend it.  I don’t know if anybody’s purchased it.

But, for example, I sell feed products from Purina Mills, and there’s a group of dealer networks across the United States.  And they have men that is in charge of–their primary duties in Purina Mills is helping dealers with their financial analysis of their company.  And I’ve shown this software to them a couple of times and they found it very interesting.  I think they’ve even made some phone calls possibly to Rusty and looking at and found this.

I also was–in the last three or four years–I’m glad I didn’t get exactly what I wanted because of the downturn of the economy in the United States.  I’ve been wanting to do a large business expansion and I was able to make five year projections for my bankers and lenders, just a few keystrokes and then I had those projections completed and they were much more thorough and more graphic for the bankers to understand than what they were used to getting.  And they had some very positive comments about the software and had questions about what I was using and how I was able to generate those kind of reports.

So, through that, it’s just been kind of word of mouth, advertising and passing the information along about SurvivalWare.

Ms. Kelly Luhring:  Great.

And then, if there’s anything that you think that you would like SurvivalWare to do that it doesn’t now, any limitations maybe that you see with it?

Mr. Stan Touchstone:  Gosh, I’m not that smart.  I’m not a programmer.  I’m not an accountant.

Everything that SurvivalWare has in it has met my needs.  I haven’t had anything that it–I’ve run across to say I wish it could do that.  I’ve been very satisfied with the product as is.

So really, I don’t–I couldn’t see–I wouldn’t be the right person to ask for changes on that.  I’m not that well versed in programming and knowing what else to do.  So, those are things that–I’m very satisfied with the product the way it is now.

Ms. Kelly Luhring:  Okay, great.

Can you think of anything else you’d like to add, any last minute comments or questions?

Mr. Stan Touchstone:  Maybe the only thing that I could see is possibly if Rusty could put together some type of demonstrations that I could look at online in my own time–.

Ms. Kelly Luhring:  –Uh-huh.

Like a tutorial?

Mr. Stan Touchstone:  Tutorials on doing projections, some of the more advanced things, and have like little You Tube–I don’t know exactly–some type of a tutorial that I could go, because I do operate a small business and my time is very valuable.  If I’ve got 30 minutes in the morning before I open my store, then I could sit down and look at a tutorial at how to better use the program and get more out of it, that would be absolutely wonderful.

Ms. Kelly Luhring:  Okay, okay, great.

Mr. Stan Touchstone:  Something like that–it wouldn’t have to be in front of a live audience.  He could just do the tutorial using somebody’s numbers.  I would even be willing to lend him my numbers and let him–.

Ms. Kelly Luhring:  –Uh-huh, uh-huh–.

Mr. Stan Touchstone:  –Say, okay, we want to–I want to look at opening a new store where I’m gonna go from 5,000 square feet to 15,000 square feet and how would I work through the mechanics of building a cash projection or projections on the spreadsheets, just do all type of what ifs and do tutorials on that so that I could sit down on my own time and be able to look at it and then go into the software and do it there.

Ms. Kelly Luhring:  Uh-huh, uh-huh.

I know that he has conducted a couple webinars.  So, they’re with groups of people that can go and see him run through sort of a tutorial process from his computer screen.  But, I’m not sure if that is more just introduction to the software or–.

Mr. Stan Touchstone:  –Some of it was introductory and I did sit through the webinars.  For me and my business and the way I had to operate because I’m very hands on, we’re a small business, and it’s nothing against Rusty, but a lot of times, the times that he has to conduct those where it’s the benefit of a lot of people, I’m sitting there listening to the webinar and I’ve got a customer that walks in and wants a lot of feed.  And obviously, I’ve got to take care of those priorities first–.

Ms. Kelly Luhring:  –Okay.

Mr. Stan Touchstone:  So, I would have to–I’m remembering a couple of the webinars, I had to get up and leave the webinar and leave it just playing while I went and worked with a customer or answered a–handled an issue with an employee or something like that because it was conducted in the middle of the day.

And that’s where–like I said, if he were to record the webinars and make them available to us so that we could go to it on the internet on our own time–I start early every day.  I get up early and I go to work early and I usually have 30 minutes to an hour early in the mornings that I can do just whatever I want to do, so to speak, without interruptions.  And that would be very valuable time that I would use to go through his tutorials to learn how to better use the software.

Ms. Kelly Luhring:  Okay, great.

Well, Stan, thank you so much for your time.  And how’s the weather down there?

Mr. Stan Touchstone:  For Central Florida, it’s pretty miserable.  We’ve got–.

Ms. Kelly Luhring:  –Really?

Mr. Stan Touchstone:  Yes.  Usually, we’re–I understand why everybody wants to move to Central Florida because we’re green nine–12 months out of the year.  We usually have a lot of blue skies.  But, the last several days has been cool and windy and overcast skies.

For us, high temperatures in the 60s is not the norm.  Usually, we’re in the mid 80s and kind of in the 60s at night.

Ms. Kelly Luhring:  Wow.

Mr. Stan Touchstone:  So, it’s just kind of Central Florida wintertime.  It’s not–I’ve been other places in the world and it is much more miserable than this, and this is probably great for a lot of people.  So, I’ll just say that it’s a great place.

Ms. Kelly Luhring:  Yeah, it’s been, I guess, in the 30s over here.  We got a bunch of snow a couple days ago.

Mr. Stan Touchstone:  Yeah, yeah.

Ms. Kelly Luhring:  But, even–my dad was telling me that in Virginia, they got up to 18 inches of snow.

Mr. Stan Touchstone:  [Unintelligible] it’s just a mess.  The whole Northeastern part of the United States has just come to a screeching halt.  And they–I don’t blame them for leaving that area if they ever got a chance to go because that has got to be miserable living.

Ms. Kelly Luhring:  Well, I went to school in Philadelphia, and so that is–it gets pretty cold–.

Mr. Stan Touchstone:  –Oh, yeah–.

Ms. Kelly Luhring:  ­–And especially in the city with all of the high rises because there’s so much wind that whips around them.

Mr. Stan Touchstone:  Yeah.

Ms. Kelly Luhring:  So, I wonder how I ever survived those winters.

Mr. Stan Touchstone:  We have–our summers here in August and September can be very brutal, extremely hot, very humid.  And we have the issue with the hurricanes whenever they come through and have to deal with all the torrid rains and the strong winds.  And in this little town here, in 2004, we had three hurricanes blow across us – significant damage to buildings, trees, lines, infrastructure.  Everything was just a big mess for months on end.

So, living through those kind of has a very strong impact on [unintelligible] that you hear of a hurricane coming, you think about–every summer, when they roll around and it starts the “hurricane season,” you prepare yourself and get ready for it, everything from making sure your yard furniture is in an appropriate place because those become projectiles and can tear up property, things like that, to just making sure your roofs are in tact, your cars have gas, you have food in the house and you have the ability, the generators to produce your own electricity for weeks on end.

So, you have to prepare for those things.  And that’s the miserable part of Florida is the summer.

Ms. Kelly Luhring:  Yeah.

Mr. Stan Touchstone:  So–but, anyway.  I don’t guess there’s any perfect place in the world to live weather-wise.

Ms. Kelly Luhring:  This is true.

Okay.  Well, Stan, you have a wonderful day.

Mr. Stan Touchstone:  Thank you.

Ms. Kelly Luhring:  And we’ll keep in contact.  If we decide–so, the–this has been recorded vocally.  And then, we might use some of the audio, or if not, just take some of your quotes, if that’s okay.

Mr. Stan Touchstone:  Okay.

I understand, and ever what you need to use, that’s just fine with me, and if you don’t use it, that’s just fine with me, also.

Ms. Kelly Luhring:  Okay, great.

Well, I think you said some pretty nice things, so.

Mr. Stan Touchstone:  Okay.

Thank you very much.

Ms. Kelly Luhring:  Okay.

Thank you.

Mr. Stan Touchstone:  Uh-huh.  Bye bye.

Ms. Kelly Luhring:  Bye bye.

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