Using the Shop Tour to Identify Pain & Close the Deal

0:01Team, this is Joe Adams with Adams Automotive, the number one shop in America. This is Master Tech to Millionaire presented by Auto Shop Answers, where we talk about the transition from technician to business owner or CEO. We are here with Champ Warren. Champ is a wealth management advisor and managing director with one of the largest investment management firms in the United States, where he's worked for over 3 decades.

0:25He oversees 3, excuse me, $7 billion in assets with a B for all of his clients, all successful successful business owners, entrepreneurs who have sold their company or are preparing to sell. And he's been recognized by Forbes, Barron's, and the Financial Times as one of America's top wealth management advisors for his achievements in the industry. So man, quite the intro, but Champ, how you doing?

0:48I'm doing great, Joe. Thanks for having me. Hey, so I wanted to have you on here because we've been getting very familiar over the last 6 months or so, but we had a dinner about a month ago and you kind of, we had a great conversation about sales, and I think there were some similar concepts to, you know, what we call our new customer intro.

1:09And, you know, I guess I'll let you reveal kind of what your sales concepts are, but you told me this story that had a lasting impact on you and how you teach your team how to, you know, have wisdom and build emotional intelligence and like kind of diagnose your customers, which are gonna be people who have a portfolio of assets and you wanna earn their business, obviously.

1:32So I guess I'll pause there, let you introduce yourself and kind of hear from you what we're gonna get into today. Sure, so all of our clients are business owners that have sold their company, or some of them we're still working with them on preparing for a sale. And, you know, I never imagined that we would have $7 billion in assets, which ranks us among the top in our industry.

1:58And if I had to, you know, say what was the key to our success, it was learning a sales message that I learned from one of our own clients. And I'll tell you this story real quick. So I'm chasing this guy who's gonna sell his business for $250 million. And I asked him the best icebreaker question you should ask anybody you run into that's even remotely successful.

2:22And I asked him, well, what's the secret to your success? And he said the Sandler, S-A-N-D-L-E-R, sales method. And I wasn't expecting that. This guy's got a petrochemical business that designs petrochemical plants. And I said, well, what's that? And he goes, well, let me tell you the story. He said, I have this business designing these petrochemical plants and I reached a plateau and I couldn't get past the plateau and I'm frustrated.

2:47I tried everything and I met with my good friend who's also a business owner and I'm complaining about this. And he said, well, your problem is you got these engineers that helped you design the software to design the plants and they're not salespeople, they're engineers. And he called them pinheads. And he goes, you gotta take those pinheads and you gotta send them to a weekend seminar, This is 20 years ago, it was $25,000.

3:10That's a lot of money. And then have them go through this and they'll teach them how to be salesmen and then they'll bust through the plateau and you'll be home free. And my client's like, well, that seems like a lot of money and that's a lot of time. I'm not so sure they're going to get transformed in just, you know, one weekend.

3:26And so his friend said, well, I'll tell you what, you do it and you call me and you tell me it didn't work. I'll personally write you a check for $25,000. Okay. Called out. Had to do it. He did it, it worked, and he sold his business for $250 million. So I'm like, oh my gosh, what is the sales method I wanna learn?

3:43And he goes, well, if you really wanna find out, call my assistant and she'll send you the CDs, 'cause they recorded the whole thing. And I got 6 CDs and I watched the whole thing. It took a long time, but I can break it down to 15 or so minutes to show you how we adapted it to our process if you think that would be helpful.

4:05Yeah, yeah. I'd love to hear that. I'd also love to hear maybe later in today's episode, like, you know, you obviously had a long career managing people's assets and building wealth for people. I think a lot of our listeners, you know, the name of our podcast is literally called Master Technician to Millionaire. And I think that's something we talk a lot about internally is how to like live below your means and create wealth for you and your family and experience compounding.

4:31So I'd love to get into that as well, but I also just wanna reiterate or parrot what you're saying, you know, Just because you can fix the car in our industry doesn't mean you're a master salesperson. And oftentimes, the 2 jobs are entirely different. And the leverage we have in the business is they're so different. They're actually quite opposite. They're not even close to adjacent.

4:56The qualities that you need to be an engineer or be a technician are in the exact opposite end of the spectrum as a master salesperson. So yeah, the Stadler Sales Method. So I wanna sell my company for a quarter of a billion dollars. So if you, with that, yeah, please educate me on how, on what the method is. Okay, so the main takeaways, a couple things.

5:20One is you gotta know the difference between a professional salesman and an amateur salesman. A professional salesman sells by asking all the right questions. So really, professional salesmen, we're not selling, we're solving, right? We got to find out what's most important, we got to solve for that and, and remove the pain, okay? And that leads to the second thing is, how do you know the difference between a prospect you can close and one you cannot?

5:50Because we're in a very hyper-competitive industry, and if we spend all our time chasing down people that we can't possibly close, well, then we get behind. And so the answer is, if you cannot find pain, you cannot close. And so we're always trying to find pain because a need is not enough. And so an amateur, you know, is going to look through the brochure and show the features and the benefits.

6:17And a professional is going to ask very thoughtful questions, which are the truth serum that we really care so we can find what's most important, the real pain points. And we can solve for that. And so we learned that there's 3 types of pain. So like my client, I'm at this point, I'm trying to get to this other point. I can't get there.

6:35I've tried everything and I can't get there. So that's real pain. And sometimes with us, that's somebody whose wealth is not growing and maybe their asset allocation is not aligned with their risk or something like that. The second one is, I see trouble coming, And I need to avoid that at all costs. And so that could be, you know, I have not saved enough for retirement, what am I gonna be able to do?

7:02Or it could be the recession's coming, now what? And so anyway, trouble's coming. And then the third one is I'm already in trouble, need to get out. And for us, that's usually lifetime events where somebody's passed away and the spouse may not be familiar with how all the investments are managed and overwhelmed, or it could be something super positive, Like a business selling, and now it's way more money than they thought, and they're completely overwhelmed, and we love that one.

7:30So those are the 3 types of pain. And can I interrupt? Is that agnostic to industry, or? Absolutely, everything. So can you, what would an analogy be for like our industry? So it's, I'm not performing to the level I thought I would, I see trouble coming, how do I avoid that trouble? And I'm already in trouble, how do I get out of it?

7:50So, you know, if we think about the auto repair business, you know, they know there's something that needs to be fixed in the car and that trouble could be coming if I don't fix it. Okay. And so we've got to align the solution with what's most important to them. And so, you know, it could be the safety of their family, right? Having the car be in a wreck because they didn't take care of it, right?

8:14That's serious freaking pain, right? Or, you know, knowing that you've got a shock on one side that's out, well, I'm only gonna fix that one when you're really supposed to fix both of them, you know? And let's not, you know, let's not skimp, you know, on what's important is that this car performs for you and it's safe and you can drive it without worrying about the safety of your family.

8:40I mean, I'm just making it up. Right, right, right. We wanna align it with what's important to them and we need to identify You know, the pain points, and that to me is an easy one. And obviously the one that they've gone way too far on deferred maintenance. And if you don't get this done like soon, it's really gonna be a problem and it'll cost far more if we don't take care of this, right?

9:02Okay, so that makes sense. So professional versus amateur, professionals solve, they don't sell, they ask the right questions, and generally they're trying to find pain. There are 3 types of pain, and it seems like the main 2 in car repair are gonna be, I see trouble, coming if I don't fix this problem, or I'm in a lot of trouble because my car won't drive right now, or something like that.

9:26But in your world, it's kind of like, hey, how much risk am I exposed to? I see trouble coming. How do I make sure I avoid that? Or, you know, I'm in a situation where I'm already in trouble. How do I get out of it? Okay. And then what's important is safety, but it could also be this is the means of transportation to my job, and if I can't get to my job, I'm not going to have a job.

9:46Right? I mean, you can really dial down into it, or picking the kids up from school or whatever it is, the car is incredibly important to them accomplishing what they have to accomplish, right? Just besides safety. Okay, so then we learn that there are 3 levels of questions to go through like a funnel to get to what's most important to them. And again, I'll tell you how we think about it in our industry.

10:15So the first level is we just have to simply identify the pain. And what I do sometimes is when I think I've identified it, I ask them, how important is that to you? Because I don't want to talk 10 minutes about something that's not important. So I confirm with that question that I'm on the right track. And so then they're going to say it's very important.

10:40And sometimes people hold their cards close to the vest and they don't want to open up. And I, you know, this is a very personal business, you know, managing people's lifetime savings. So if they're holding the cards close, I'll say, listen, it's really important that I understand. And I'll say it genuinely from my heart. Could you, could you please tell me more so that I can get them to open up?

11:01And if they don't, then that's a red flag that they may not be serious. The pain might not be real. And all they want to do is figure out what is my solution. What is my price and go shop me someplace else, right? So anyway, I get to tell them, get them to tell me why it's important. And then the next question is, well, how did this start?

11:21And I want them to explain it to me, like almost like you're diagnosing, you know, the car on the fast, uh, uh, lift. And then, you know, the next question is, well, what have you done about it? And I want to know what everybody else has done to try to solve, to remove the pain that did not work. And I'm taking notes because I'm going to make sure that we don't do that.

11:45And with your business, it could be doing the same work over and over that somebody else has already done and it didn't fix the car, right? And so I want to almost get them frustrated because if I can get them frustrated in front of me, then I know the pain is real. And then the next question, is going to be, well, um, you know, what have you done about it?

12:07Again, that the things that did not work. And then the next question is, what could they have done to make it right? And so this is a super powerful question because I don't want to guess what I need to do to remove the pain. I want you to tell me exactly what my proposal needs to be. That's what you're looking for that's going to make you happy.

12:28And then like a waiter at a restaurant, I'm going to write it down and it's going to be perfect. I'm not going to, you know, act like I'm so smart and not write it down and not pay attention, because the whole time you're sitting there going, they're not going to get this right, he's not going to remember. And I don't want that to happen.

12:44So the, the, the, the food, my solution is going to be perfect. It's going to be exactly what they asked for. And I had a mentor tell me once, you know, if a, uh, client wants a grape, don't sell them on the benefits of a strawberry. Find out what kind of freaking grapes they like and give them the right grape. It's not hard.

13:03But so many times we get so enamored with our solution and think we're so great. We're like, open up your mouth and we shove it down your throat and this is the only way you can do it. And that doesn't make them feel good, right? Okay, so we go through all those questions to really diagnose the pain and then get them to tell us what won't work and what will.

13:23And then we fix it for them and remove the pain. Okay, so now we've identified That's first level. Second level is we gotta quantify the pain. And so the question could be, if we could put a solution together that addresses all this for you, what does that mean in terms of the economics? Like, what's at stake? And if they lost 57% in the financial crisis, which is what the market went down, $20 million going down $60 million, goes to 8, and that's $12 million worth of pain.

13:58They don't want to have that happen again when the next recession is coming, right? And they know it will. And so if we can have a solution that helps minimize that pain, my fee is less than 1%. 1% is a lot cheaper than 60% or $12 million. And so if they believe that I can keep them from losing that much money in the future, they're more than willing to pay my fee, and the fee will not be negotiated because it's worth what's at stake, right?

14:28And so that could easily happen in your business if you don't, again, fix these shocks and all the other components start to wear out. This could be a whole lot more expensive than just replacing the shocks, right? Okay, so we've quantified the pain and we understand what's at stake. And then the third level is trying to personalize the pain. And that's just one simple question.

14:52The question could be, if we could find a solution that addresses all this for you, what does that mean to you personally? Which is an ambiguous question, and it's on purpose, 'cause I like to ask questions that nobody else asks. And so they're like, well, what do you mean, champ? And I was like, well, okay, well, you told me about your business and the 30 years, and the long-term plan hopefully is to sell it one day, and all the ups and downs, the near misses with the recessions and the sacrifices away from your family.

15:2330 years, let's fast forward and assume we're at the finish line where we're ready to sell this thing. What is it you want personally? What is it you've been working so hard for? Help me understand what it is so I can help make sure that that's what happens. And then sometimes they do this deal, they put their hands behind their head and they stare at the ceiling like, oh my gosh, that's such a great question.

15:47And so now when they do it, do that, they're like, they're soul-searching in front of you, and they're about to open up and let you into their personal world where almost nobody else is. And they're going to tell you something super personal that's motivating to them, that's driven them. And I've heard lots of wild different things. I've heard, well, I just need to have $20 million in my checking account, which is a little bit shallow, but if that's all you want, that's fine.

16:16I want a jet so I can travel. I want a yacht because I love yachting and want to sail around the world. I want this $50 million place in Vail, and it's going to be, you know, the place that brings the whole family together. And I believe that if you answer my question in our business, I believe I've closed you at that moment.

16:38Okay. Because I believe there are not too many people that know the answer to that question. And I think the only reason you would tell me sincerely, genuinely from the heart is if you've already decided in your mind, I know you better than maybe just about anybody else. I know exactly what I need to do to remove your pain. And you've decided in your heart that I'm the one that you're looking for.

17:01And I really do believe that because I, I don't think many other people, maybe no one else knows the answer. Let's just use the example of the $15 million place in Vail. You know, I may not have told my wife because if she knew we could sell the business and go get the $15 million place in Vail, she's ready right now 'cause she's worried I'm gonna keel over and die and leave her with this mess and it'll go to hell.

17:26And she's afraid of that. And so I may not be ready. And so I don't wanna get her all excited about it. I haven't told my wife. I haven't told my best friend because now, You know, I'm a, I'm a jerk. It's, it's about money and I'm richer than you. So I haven't talked to my friend about it. I haven't talked to my, uh, banker about it because when we sell the business, the banker has to get paid off and that puts an expiration date on the relationship.

17:53And I need them to keep going to bat for me. So I haven't told the banker and I haven't told my CPA or my attorney because it's not time. But you told me. And I think, again, the only reason you would tell me is because you decided he's my guy, he gets me, he understands it, and I believe that you can get me what I want.

18:12So the worst thing we can do, and we call that a sacred moment when we have this special connection, you know, where we can just feel it, you know, um, the worst thing we could do at that moment in our business is go, well, Joe, let me tell you how we're going to get you that $15 million place in Vail. We whip out the brochure and start turn it into a salesman, or not the brochure, but the proposal.

18:37Okay, a lot of people— yeah, sorry, proposal. And a lot of people think that you got to strike— in our business, it may be different in yours— you got to strike when the iron is hot. But in our business, meeting 1 is about discovery, and the purpose of meeting 1 is to have a meeting 2. And meeting 2 is when we, you know, share our proposal and we sell the benefits of the proposal.

19:00And so, you know, the way we finish our first meeting is we ask to summarize. I thank them for telling me something so personal, and I tell them it would mean a lot to me to be the person that helps them accomplish all that. And I want to summarize the meeting before we leave. Would it be okay if I summarize the key points to make sure I got everything right?

19:23Sure. And it's like the waiter. You know, yeah, repeating the order, right? So we go through the pain points and I put a star next to each one. So I got 2 pages of notes. I go through the key pain points and then I'm like, am I on the right track? Oh, this is exactly what I'm looking for, champ. Okay, well, did I— is there something I forgot to ask or is important to you that I didn't think to ask that I need to know?

19:46No, this is it, champ. Okay, well, you know, Joe, I'd like to be able to put a a solution. I don't say proposal because it sounds salesy. A solution together that addresses all these things for you. Um, and, you know, I'd like to meet with you next week if that's okay to present it. And you're like, fine. And I said, but, you know, can I just ask you one more question before we leave?

20:09Sure. Well, Joe, if I can put a solution together that addresses all these things for you, you know, would you consider doing business with me? 'Cause I want a kind of a verbal that I'm on the right track and that, yeah, I'm in the running. And of course you're gonna say yes. And then we come back in the second meeting and we have it in writing.

20:33You know, we don't say pain, we say challenges. And then we have the key points just like we summarized with the topic on what it was. And then a one-line description. And then below we have solutions. And the rule is every one of those solutions has to relate to something that's above that were the challenges and how it's going to remove the pain, how it's going to address that challenge.

21:00And so we have the same thing, a topic, a description. We go through that. And then the last, you know, challenges they want, we call it an aspirational you know, deal that, you know, uh, aspiration in which it's the $15 million placing deal because we want to start the meeting in that personal space, right? That's their— that's their soul. They're soul-searching. That's their— so we wanted to open back up and get back into that mindset and that vibe.

21:30And then we, we, we summarize that. Are we on the right track? Did you think of anything else? No, this is it, champ. This is what I want. We do the proposal. We go back to that summary page and we summarize it one more time and they're like, yeah, this is it. And I said, okay, well, at the last meeting you told me if I could put a solution together that addressed all this for you, that you'd consider doing business with me.

21:52Joe, I really want you to be my client. I've done this many times. I've been at this for 33 years. We've gone through this process many, many times and I've geared my entire team to taking care of business people like you to help you accomplish your personal life aspirations and to take care of your family. And so tell me, what more do I need to do to get started?

22:12Because I want to get to work for you. I want you to be my client. I want to get you that place in jail. And they're like, you tell me. And then we whip out the docs, we put the fancy pen on top, and we start signing up. And so that, that's a simplified, compressed way of how we do it, but that really is how we do it.

22:28And the whole goal is to make meeting one a discovery meeting for us Because if we whip out, if we whip out the solution in our business right then and we had this perfect personal moment, then they know that nothing that was in that proposal had anything to do with anything you shared with me. Yeah. And all we're doing is showing you the cookie-cutter BS proposal that everybody gets to see.

22:55And now I'm not special anymore. And I'm wondering, why are you not calling me back? Right? Because we kind of ruined it when it's such a personal thing in our business. But trying to get to the funnel of what's most important, i.e., that my family is safe, or i.e., that I can have a reliable car that gets me to work so I don't lose my job, or whatever it might be, you know, that's, that's the whole key.

23:21And then we can put our solution in perspective with what's super important to them about having a reliable car, then it's a little bit more than how much is it going to cost with you, because you took the time to understand me and now you're going to have a solution. And now I feel like I'm a little more of a closer, maybe even more of a personal relationship with you than just somebody that gives me a number.

23:48Does that make sense? Yeah, that makes a lot of sense. So I got a couple questions for you. So to break that all down, you gotta identify the pain, you gotta quantify how important it is to them if you're able to fix that pain, you've gotta personalize it. If we could solve this pain, what would that mean to you personally? Those seem to be extremely effective in wealth management portfolio.

24:10It's like you literally, your hopes and aspirations, but I have the challenge of condensing that process down to like maybe a 5-minute interaction at a front counter, 'cause we've got 20 or 30 customers that day. But I really like what you're saying about identifying the pain. So for us, it might be, you know, 'cause we like to train in Key2Key that the only way you get a new customer is by a customer basically terminating the relationship with their previous providers.

24:42Like, if you've had a technician or a mechanic working on your car for 20 years, like, you're not gonna come to my shop just because I advertise to you. Like, they're gonna have to, drop the ball somehow, or not be open on the weekends, or not provide good service, or take advantage of you, pain, in order for you to give me a chance.

25:02And so, we talk a lot about, in the new customer intro, identifying the pain, which is, well, I used to take it to the dealer, and they— So we literally ask the customer, hey, what took you so long? We've been here 40-something years. How did you hear about us? What took you so long? And I'm sneakily trying to identify what their pain is.

25:22Well, I fired the last shop that I've been going to for 10 years because it was the dealer and the prices got too high and the service wasn't good. Or, you know, maybe a different— maybe it's a shade tree mechanic. I had this small guy, but he didn't fix it right and he took advantage of my wife or whatever. Now, what I always like to do is I like to kind of metaphorically slam the brochure or the proposal on the table immediately because, you know, they'll tell me their pain and then I get to say, well, man, that's great news.

25:54Like, Did they take pictures? One of the things we do is we take pictures, blah, blah, blah. But I'll pause here. My question to you is, should I hold that back? And should I basically validate their pain? Be like, man, that's probably a horrible feeling to feel like you're taken advantage of. And then have the sacred moment and then maybe 5 minutes later be like, hey, I know you mentioned this bad part of your previous car repair experience.

26:21Here's one of the benefits that we have as we do this, this, and this. So there's kind of— Does that question make sense? Yeah, I mean, you're in a transactional business, and so you have to transact, right? And we're in a relationship business, you know, that lasts generations. And so it's 2 different types of businesses, but, you know, the pain can be different.

26:44I mean, the pain could be, you know, I need my car back quickly. Right. I need somebody to be honest with me. And if somebody takes the time like you guys do to diagnose the car and explain it to me to where I completely understand— you also show the pictures in the video, and you're going out of your way to make sure that I understand how this really is an important, uh, repair that needs to be made.

27:13I understand why it's important to my car, how it works, because you show me the little video deal. And you can take care of me quickly and you guys go the extra mile to, if I need a ride back to the office or a ride back to my home, that you can arrange that for me. I mean, you're just making it so easy for me to just say yes.

27:35And because it's transactional and because I need my car, for you to be able to go through it quickly, get the parts, turn it around, and be able to do that even when it's inconvenient on a weekend when some people are closed. That could, that could really mean a whole lot to people that if that isn't done well and done consistently, then they're not going to see the value, you know.

28:01And then you're going— and the fact that you're going to such extents to remove my pain, this inconvenience of my broken car, to make life easier for me, I mean, that means a lot. And not everybody does that. And so I think there's different ways to highlight it. But yeah, you can't diagnose on day 1 and repair day 2 or 3. It's like, you gotta, I really do think in your transactional type business, you've gotta strike when the iron's hot and they're there, but you gotta highlight the idea that you're gonna make life so much easier and better for them with your approach and your process.

28:38Does that make sense? Yeah, it totally makes sense. Yeah, because one of the main objections we get is just like price, you know, like obviously it's— we don't believe our business is a commodity business. It's like a service business and you pay the premium for the quality service. And a lot of our customers understand that, but sometimes it's hard to get to communicate with customers the quality of the service and they can very quickly call another shop and get some made-up price on a different part, you know, and now we're the expensive people.

29:08So do you ever run into that? Like, you know, I guess you have such a slow burn in terms of building the relationship. It does. 4 years. Sometimes it takes us years. Yeah, yeah, yeah. To build a relationship. So it's a different deal. But, you know, like in your business, you know, if it's, I want it done quickly, right? I also want it done right.

29:32So you've been around a long time. You've got these highly trained technicians. And I'm not going to have a situation where I drive it home and it's like, oh my God, this isn't right, and I got to go bring it back and do it all over again, right? Because you've got that high quality people and the high quality of service. And so there's all kinds of little, little things that you can do that make a huge difference that not everybody else is even thinking about.

29:59I love what you said about, uh, uh, Does that sound right? Like, you kind of repeat, you're almost like pre-firing the objection. You kind of say like, so it sounds like if we do this, this, and this, that will solve your pain and solve your problems. Like, does that sound right? And then if you're not covering it all, they will clarify. They'll be like, oh, I'm also wanting to do this, this, and this.

30:24And I think that applies to both of us. So it's like, so what I'm hearing you say is your objection is, this, this, and this. Or, so what I'm hearing you say is if we, you know, have fast service and total integrity, you know, you'll be our customer for 20 years or something. Okay, awesome. So the, the, the, the main gist though is amateurs sell and professionals solve, and you have to identify the pain in order to solve it.

30:49Whereas an amateur, they're just gonna— and go deeper, right? You go deeper, you understand them better, you understand what, what if they're What are the pain points that make this process frustrating? How do I make it where it's not frustrating? And thoughtful questions to understand what they're going through, not just about their car, is like the truth serum that you really care.

31:14And when you go out of your way to make it easier for me, that's also truth serum that you really care. And then if you do what you say you're going to do and the price is what you said it's going to be, and you're honest with me and you care and it's right every time and you make it easy, okay, I'm coming back.

31:33Right? Right. Yeah. Yeah. So transitioning here. Okay. So do you have any anecdotes from your business where you— oh, you laughed. So I'm sure you do where you've implemented the method. Yeah. You want to dive into? Yeah. So I'll tell you my favorite story. So, and I'm not— I'm going to change the names for the, to, you know, Protect the innocent. So this is one of my favorite ones.

31:56So there's this investment banker that's selling this business and he wants us to meet this client and it's gonna sell in a couple years and the guy likes to pick stocks and he goes, Champ, why don't you just talk to him about the outlook on the markets and how you're positioned in general and what you might do if things change or there's a recession or whatever.

32:17And so we go through this outlook on the markets and kind of our process on how we think about things and how we're structured and he loves it 'cause we made it so simple so easy to understand. He's like, Champ, would you, would you mind, you know, having the same conversation with my wife and 2 daughters? Because they really need to understand this, and you just made it so easy.

32:37And we— yes, we will. So we meet in this, this place, uh, private restaurant at this private club, and it's very fancy, you know, with all the mahogany and the Persian rugs and the china and the crystal, the silver, the whole thing. Here's dad and 2 daughters. Sitting on my place setting is a statement from Morgan Stanley for a $28.5 million trust.

33:03That never happens. After the pleasantries, he says, Champ, I already talked to my wife and 2 daughters about the outlook on the markets and how you think about things. I just couldn't help it. I went ahead and presented it to them. So we had a family meeting and decided that We want to transfer this $28.5 million to you and your team because it needs to be professionally managed.

33:26I picked all the stocks and I've kind of neglected it. I got busy in my logistics business and I don't have time to mess with it. And so it really needs to be professionally managed. So could we just transfer this account to you and then you look at the stocks and tell us which ones you would keep and which ones you would change and come back with a proposal?

33:46So this is, this is a layup. This is like, uh, no, it's gonna move. Okay, okay, okay. This is crazy. So my antenna is going up. It's like, there is some pain here. I gotta figure out what is making them throw it at us, right? Why are they firing? Yeah, yeah, got you. Okay, got it. It's not, it's not that, it's not that market outlook that did it, right?

34:07And so we find out that, uh, Dad, his pain is he hates the government because they tax him so much and they waste his money. And he's— his whole life is efficiency in the logistics business, and he can't stand that they waste his money. And so, okay, fine, I've heard it a million times. You hate paying taxes, I got it. Mom comes from the money, and, you know, this is the money she inherited from her father.

34:35And in the last recession, it got hit hard in '08. So the big recession, and she just can't deal with that. And so that was, I see the pain coming again. I want to avoid it at all costs. So we figured it out for mom, and then we had to figure out the aspirational personal pain. And mom comes from all the wealth, and so they love yachting, and they have this yacht that they take to the Bahamas with the whole family, and they do their thing in the blue water, and then they come back, and that's, that's their thing.

35:07And then I found out that that mom's got a challenge, you know, in her knee and going up all the steps is hard. And the only way you fix that is to get a longer one. They've got a problem coming. And there's— I need another multimillion-dollar yacht. Okay, yeah. Yeah, they're so excited about the new one that's coming. And so anyway, we got it and then we go back to the office.

35:30So let me clarify. So you've got a mom and a dad and their family and the wealth— 2 daughters. And 2 daughters. And the wealth is generational from the mom's father who is, you know, that's previous generation. And the dad's pain is he's got this other business that he runs and he doesn't have time to manage the portfolio and he hates the government or something.

35:53He hates paying taxes. So, and we know that, and we know that the mom loves yachting. Okay, so that's the picture. And then how do you, so how do you close them? Yeah, and then the pain is I don't want to have to go through this again, right? Okay, so then We come back and the problem is that almost none of the stocks match up to how we would have done it.

36:13And so it's gonna be a big tax liability to make a change and dad's not gonna be happy. We're gonna call him Jack and we'll call mom Jill. So anyway, we come in and I start going through the pain points. I start going through the solution. I go through the actual solution after I line it up and they have agreement that this is what's going to work.

36:39And then I present it to them and they love it. And we go through the summary and I tell them I want to be their client. I want to get this going. I want to put this solution in place. Mom and the 2 daughters are there at the boardroom in his office and they are thrilled. And then Jack's like, hold on, not so fast.

37:00Champ, did you count how many stocks we have in that portfolio? Yes, sir. And I'm talking to him exactly the way I'm talking to you, okay? Yes, sir. How many do we have? You had 220. Well, how many of them match up to your way of doing it in your proposal? I said, 12. And he turns red and he's like, so you're telling me we're gonna have to sell 208 stocks to match it up to do it your way?

37:25Yes, sir. And now he's very unhappy because he knows what that means. And he's like, now his tone changes and he starts to have some, you know, he's not happy. There's some venom in his tone and he's starting to raise his voice ever so much. And he goes, well, Tim, did you happen to calculate the gain we would incur if we get it your way?

37:48And I said, yes, sir. And he goes, well, how much is that? I said, $6.7 million, with a totally straight face. And he goes, well, no. And I think he's going to have like a stroke or something. He's raising his voice. Well, did you calculate the tax we'd have to pay on that? Yes, sir. Well, how much is that? I said, it's $1.6 million.

38:08And I really did think he's going to die. And so he's turning red. He's yelling at me now. And he says, well, Jeff, that's like an additional $1.6 million fee on top of your fee to do it your way. Why the hell would we do that? I'm just as calm as can be. And I said, well, Jack, let me explain. And I stopped talking to Jack because it's not Jack's money, it's mom's money.

38:30And I looked at Jill. Right, right. Okay. And then I reached into my briefcase and I pulled out the original $28.5 million statement that was on my place setting in our first meeting. And I dramatically slid it onto the middle of the boardroom table where everybody could see it. I even patted it a couple times and I said, Jill, what we have here is not the $28.5 million trust that your father gave you many years ago before he passed away.

39:00What we have is a $28.5 million yacht. We went to the marina where you said it was and it's not there. We found it out in the middle of the Atlantic Ocean between here and the Bahamas. I don't know what happened, Somebody didn't tie it down, keep an eye on it, whatever. But we finally found it and we did an inspection and we found out there's no rudder, the motor's frozen over, it won't, it won't start, there's no crew on board, there's no navigation, there's no communications, there's no nothing.

39:31And in '08, when the financial crisis happened and that hurricane came through, it did extensive damage to your yacht. And when we started to look at and we, we showed them the top 5 positions they had. They were in a chart from peak to trough. They were down more than the market. And your $28.5 million went down to $12 million, and you had $16.5 million of damage to your yacht and to your portfolio.

40:01And we know the hurricane's coming again. And so yes, uh, we're gonna put the best crew in the business on board 24/7. We're going to put a brand new rudder on there because this yacht cannot possibly get to wherever you want it to go. We've got a portfolio manager that's like a master mechanic that's going to get that engine up and running as good as new.

40:22We're going to put state-of-the-art communications, state-of-the-art navigation, and then this time we're gonna have radar. So when we see the hurricane coming, we're going to find the closest port, we're going to park your yacht in a safe harbor, and it's going to have some damage, but it's not going to have, you know, $16.5 million worth of damage. And then we're going to get it right back up and running and repair it very quickly, dial that waypoint in, and we will get you where you want your yacht to go safely with you and your family every single time.

40:54And Jill, to do anything else would be unreasonable. Yes, it's going to cost $1.6 million, but again, to do anything else would be not unreasonable. I said irresponsible. Yeah. Okay. Yeah. Irresponsible. And so here's what Jill did. She raised her hands, she slammed them on the table, and she said, Jack, I couldn't have put this any better myself. This is my daddy's money, and I cannot go through this again, Jack.

41:24We talked about this. We had a family meeting, and all of us decided that we're going to transfer this money to Champ and his team so it can be professionally managed. And she looked at her daughters and goes, girls, isn't that what we decided? It's their inheritance. Well, of course they want it to be taken care of and not neglected. And so they're— and so they're like, I cannot go through this again.

41:44I felt so much shame. Champ, what do we need to do to get this done? And I took out the documents and I put my fancy pen on top and I slid it over to Jack and I said, well, Jack's the trustee. He needs to sign. Jack, sign it! So Jack took my pen and his hand was literally shaking, trembling, because he knew that was going to cost $1.6 million.

42:08And he signed it. And I had no doubt whatsoever that we were going to get that deal because, Mom, when you get good at this business, asking the questions— wisdom to me is when you can hear what, what's not being said. Okay. And what's not being said is that my husband's too busy to manage my inheritance. And I felt shame and pain and embarrassment when it went down and no one did anything, didn't even look at it.

42:40And if my father was still alive, he probably would have gone out of his mind. And what she was asking me to do was please help me fire Jack. Because he's been negligent and she couldn't do it herself. She needed me to tee it up. And by me, you know, understanding the pain and quantifying the pain and then aligning it with their personal aspiration, which is if y'all want to continue enjoying yachts, this needs to be managed really well and you don't need to be going through this again and feeling that shame.

43:11And so I just needed to tee it up for her. And I knew she would send it home. And that's exactly what happened, because even though she didn't say it to me, I could hear it. I could feel it. Right. And again, we just took the solution, aligned it with what is most important to them, and it was easy. And really, it's just us understanding them a little better and removing the pain.

43:37And then every time we close business, and I don't know how you might adjust or make— ask this question, but we always ask this question whenever we close business. I always say to them, look, I have one more question I would like to ask. It's very important that I understand. And I said, you could have done business with anybody. Why did you choose to do business with me?

44:00And 99% of the time they're going to say, because you're the only one that really listened. Okay, you gave me exactly what I needed, what I was looking for, and it was perfect. And then sometimes they'll tell you things that you hadn't thought of, and then, then your antenna goes up and it's like, oh, I didn't know that that was important. Uh, now I'm gonna make sure that I add that to my list of pain points that I'm looking for.

44:26Okay. Every meeting going forward. And so it just makes you better and better and better, right, as you find places to look to remove the challenges or the pain points when nobody else is looking. And some of those things can be super important and nobody asked, but I did. And, and it— I think it just gives me a competitive advantage over everybody else because it helps me to ask more thoughtful questions and to remove more pain, and certainly in places where nobody else is looking.

44:53Man, that's so good. That was one of my favorite, favorite deals because they were— everybody in the office like, oh, you're never going to get that deal. I'm like, oh yes, yeah, yeah, put me in, put me in, Coach. Oh man, We've had some of those deals around here and it's like, you're just not getting that deal. And then they get the deal, you know?

45:10And so I love what you said. So you basically had to just personalize the pain and you had to understand her aspirations. And then you just use the aspiration as like a way to paint a picture. Like, hey, 'cause yeah, you can just totally see it in your head. Like, man, I know, yeah, I know. You're not thinking about a portfolio. You're thinking about like, man, my yacht, you know, is gonna— So you had to ask her in the pre, you know, the new customer intro, basically.

45:33Like, what would it mean for you if we were able to, like, make this happen? Like, what are your dreams? And you learn about the job. You go from being irresponsible about this to being responsible and to getting sleep at night so I can keep enjoying being rich. Yeah. So I'll tell a story in our business, similar theme. You know, we had a guy, um, and he comes in at 4 o'clock on a Sunday.

45:57For a state inspection, which is $18.50. And he drives a yellow, that's key, yellow FJ Cruiser. And we identify, I use a power steering rack and brakes and stuff, and it's something like $4,000 worth of repairs that we're presenting to him. And obviously, he didn't know he had the pain. He didn't know he's got a broken car. And so it's very difficult to convert $0 to $4,000.

46:24It's different if they come in and they're like, hey, I know I have this big problem with my car. Can you fix it? And then, you know, we present the price and David, he was the one selling it, and he's one of our top all-time salespeople, all-time ticket average, and he objects. You know, he's like, well, the price is too high, yada, yada, yada.

46:41Anyway, this is like, he approved the initial like brakes or something, but the big ticket was the power steering rack. And David just gets off the price. He just stops like, as he's talking to the guy over the day or two the vehicle's in the shop, He comes to find out that the gentleman is a beekeeper in his personal time. He harvests, I don't even know the word, honey.

47:08And he's even got a yellow car. He loves beekeeping. It's his hobby. He sells it on the side. And David, he's like, man, it's like his aspiration. It's like, hey, what do you— so tell me more about what do you do? And he opens up. When you ask somebody about their passion, they just open up to you. And he's like, Yeah, you know, I've been doing it this many years and like I sell it on the side.

47:31It's this organic stuff and like, you know, the bees, man, when you buy the stuff at the store, it's like this processed— see, we're not, we're not talking about the car at all. Anyway, at the end of the guy's spiel, David's like, so you said you sell it, right? Like, who do you sell it to? And he's like, man, I'll sell it to you.

47:48Like, like, do you guys want to buy some honey? And David's like, yeah, I'd love to buy some honey. Like, how much do you charge? Is what he asked the customer. And he says the price and he's like, could I ask you, Mr. Customer, like, are you— you're nodding your head because you see where I'm going with that. He's like, so you mentioned like all the organic and like the— you're locally owned.

48:09Like, does it— is it cost you more to like— do you have to charge more than, you know, the guys at, you know, Trader Joe's or H-E-B? And it's like he closed— that was when he closed him. You know, he was like, you know, like the customer was— it clicked in his mind. He's like, oh yeah, like I have the good stuff.

48:28I have good stuff and I'm proud of it, but I have to— it costs me, you know, this much money to like produce the good stuff. And David was like, that's how we feel, you know, like we're family-owned, we're going to be here for another, you know, 50 years. We've been here 50 years, you know, we've got master technicians, we're not putting cheap crap on your car.

48:50Yeah, you know, we love our honey. You're gonna love our honey. And, and, and it's— it worked, you know, and he's been coming for years now. And every time we're like asking to buy the honey, you know, like, hey man, did you bring any for us? Because that's the thing, you know, it's like if I can identify your aspiration or what you're into, and then when I'm trying to fix your pain, like what, tee it up the way that you did.

49:14So anyway, I— Personalize it. Yeah, perfect. Yeah. Perfect. That's a great example. So that's good. I love that example. It's funny 'cause his car is yellow, you know, like his car is like, he literally has a yellow FJ Cruiser, you know, it's like a, Anyway, I could go on and on. We've got all the stories in the world, but that's really good.

49:32So to recap, it's the Stadler Sales Method. A professional solves, he doesn't sell. You have to funnel them into identifying what their pain is, personalize it to them, quantify it, kind of identify what their aspirations are. If I can fix this pain, what does that mean to you? And they basically tell you how to close them. You're basically trying to listen 'Cause most people just talk 80% of the time.

49:57You're basically trying to listen to the customer with wisdom, like you said, tell you how to close them, and then you close them. You bring out the big pen. Yeah. Fancy pen. I mean, 'cause the discovery's about them. They should be doing most of the talking. We should just be asking the questions, for sure. Okay, sweet. So that's really great. I hope some of our team members can apply that to their own personal book of business and see how it works.

50:24So let's transition. I want to talk one more thing about, you know, just you've been obviously helping people protect and preserve and create wealth for your entire career. And a lot of the people— part of the reason I'm so passionate about this business is I came from resources and a lot of people in our business didn't. And that's just the nature of— it's a blue-collar industry.

50:45You know, a lot of our employees and team members maybe worked for a giant chain that didn't really care much about them, and they've never thought about what their retirement looks like or what a 401 is or an IRA or saving for their kids' college. Now, we've also got people that listen to this and might be a single-unit operator that they're like my dad.

51:09They were a master technician and they didn't go to business school, but now they run a successful small business. You know, they're trying to create wealth for the first time in their family. And then we've also got people who listen to this who might be more sophisticated. They might have multiple units or a chain in a region. And so I wanted to spend some time with you just talking about, we can start at the beginning, just any advice or feedback you have to our team members, maybe people that are just, I don't wanna say just, but starting off in their career, trying to create wealth for the first time.

51:45Where do you start? It can be pretty confusing. It's similar to how a car is confusing. They might know a lot about cars, but it's really not that complicated when you break it down. So if you were a person on our team with W-2 income trying to create wealth for their family, like, what is, how does it all work? Yeah, so it's so important.

52:06And I, they don't teach this in element or in middle school. And so I go around schools teaching financial literacy all the time, but it's more wealth creation, not budgeting. And so I'll just go through some very, very basics and then we can go in whatever direction you want. But if you think of wealth creation, it takes money to make money, which is unfair if you don't have a lot of money.

52:31And my family did not have money. And so, you know, that can seem unfair, but the reality is it doesn't take a lot of money to make a lot of money. It just takes a lot of time. And that means you gotta start early. And so if you do have, you know, certainly young people that are technicians and they're fortunate because you're giving them a living wage where, you know, they can live within their means and have money left over, the trick and the key is you gotta buy assets.

53:05And this is not the accounting definition of an asset, but in, In investment world, an asset is anything that puts money in your pocket. And so many young people suddenly get the job, they're a technician, they're certified, they're making good money, and they have a hole in their heart and soul and they want to fill it with all the things that they went without.

53:28And so they end up buying liabilities and not assets. So liability is anything that takes money out of your pocket. And a lot of times that could be a car that's just to show off or apartment or a home that's too expensive, and now I have no cash flow left over, and I don't have anything to buy any assets that will appreciate in value and put money in my pocket and create wealth.

53:49And I'm in the rat race. We're just living paycheck to paycheck. And so what we really should do is find things that are going to appreciate in value, and rich people only buy assets. They don't buy liabilities. And because those assets put money in their pocket and gives them extra cash flow, then they have money left over to buy more assets, which gives them more cash flow.

54:12They buy even more assets. And that's how the rich keep getting richer is because they only buy assets. And so, you know, if I were starting out and I've done this with my own children, just buy the S&P 500 index. If you went onto Google and asked, what's the 10-year average return of the S&P 500? It's over 13%. If you ask for the 50-year long, long-term average, it's right around 9%.

54:38And if you took just a quick example, if you took $100 a month and put it in the S&P 500, and that's $12,000 a year, and you did it for 50 years, so $1,200 a year times 50, $60,000. Over 50 years, you saved, all you did was save $60,000. Yeah, yeah. That would literally compound 'cause it's growing off itself, right? And it's making money, adding to the base and growing and making money and adding to the base every year and growing.

55:13That's called compounding. The $60,000 turns into a million. But it takes 50 years. Yeah, $100. Right? $100 a month, $1,200 a year times 50, $60,000. Turns into a million. Now, the key is if you wait 10 years and only invested the same way for 40 years, it's only $400,000 plus because the compounding working off the big base has the greatest effect at the end, not in the beginning.

55:43And so if I wait too long to save money, I might not ever get to my goal. And certainly, working as a tech for you, I have the ability to save way more than $100 a month. And so we did an example of where if you're 16, you do $100 a month. Now you're 26, you have a job, maybe there's a 401 or retirement plan where you can start to save money for retirement and you save $1,500 a month, which sounds like a lot, That's $18,000 a year, but out of $80,000 or whatever the pay may be, $50,000, $80,000, it starts to be manageable if you're single and you haven't bought the house and you

56:27haven't done all that stuff yet. And so that ends up being $700,000 over 50 years and turns into $7.6 million, right? So you can be a multi, multi, multimillionaire if you just start soon enough, And the key is to pay yourself first. So we always pay our bills first and then whatever's left over, I splurge on some. And then after that, maybe I have something to go buy some more S&P 500 shares.

56:56And oftentimes we don't. And so if you just automatically get direct deposit into your checking account and you set up a brokerage account and it's whether it's at Schwab or wherever it is, doesn't matter. You can tell it every month, 2 days after payday, put $100 or $200 or whatever it is into my brokerage account and automatically buy the S&P 500 index as soon as there's enough money in there.

57:24And then it comes out first. You don't have it to spend, and now you're managing what's left and you're just prioritizing long-term savings. And it's amazing how many people don't do that. And I've had conversations with incredibly smart people with master's degrees from the Ivy League schools that would tell me when they're in their 50s, they're freaking out because they didn't save enough for retirement because they spent all their money or had excuses.

57:51Well, I need a house. I need to put money for kids' college and blah, blah, blah. And they never prioritized. And now they realize when they do the math, they'll never get there. And so their lifestyle's going to be completely different. But again, as a technician, certified, you can make good money. If you start early, you can have $1 million, almost no excuse not to have $1 million 50 years later.

58:21And it should be multiples of that if you get good at saving money and budgeting your money and just prioritizing retirement first. I liked what you said about an asset puts money in my pocket and a liability takes money out. And the reason I know people can do it is because I see new cars show up in our parking lot when people work for us long enough.

58:45And I always ask them, like, do you know any super wealthy people that drive new cars? Like, they just don't, you know, on average they don't. And the analogy I like to make is, Like, let's say it's a new F-150, okay? And it's an $800 a month note. I'm like, if you make that payment for the next 45 years, what are you gonna have?

59:09You know, you're gonna have 10, you're gonna trade in your car every 5 years, and you're gonna have $800 a month payment for 45 years. And at the end of 45 years, you'll have a 5-year-old F-150 that's worth you know, $15 grand or something. And I was like, you could drive a Corolla, you know. And, and maybe people don't want to drive a Corolla, and I get it, but it's like, you know, $800 a month is a lot of money that you could be putting away.

59:35And it's like, I don't know what the math is, but it's probably several million dollars in retirement if you start in your 20s, you know. It is. I mean, you know, the cost of not having that invested in appreciating over 40 or 50 years is millions of dollars, literally millions of dollars. And like, I only bought one new car in my life.

59:57It was right out of college. I bought a Mazda Miata, and that because I was just lusting after that car. And that's the last new car I ever bought because I like buying cars with 20,000 miles on them for 50% off, and they're just going through adolescence, you Yeah, let somebody else take that depreciation. Absolutely. So let's, okay, so S&P 500 compound interest, the most effective compound interest ingredient is time.

1:00:26Most people just start too late and they put their wants in front of their needs, which is safety for their family. But, you know, let's transition here. My dad was a cowboy, still is, you know, and he's never been big on the S&P 500. Said one time, he's like, Joe, I was in the S and Me 500. That's what he said. So funny.

1:00:49Because he's like, because, you know, when you're growing your business, you can either buy shares of the S&P or you can buy a Lyft. You know, you can put that money in painting your floors or in, you know, investing in the business. And so I think there is a line from paying yourself first and setting up for retirement, and then, you know, how do I minimize my taxable income, um, and invest that money back into the business?

1:01:15So do you have anything to say to like kind of the middle level, you know, before we get— because when you're a multi-unit operator and you've got over $1 or $2 million a year in EBITDA, the whole game changes, you know. But when you're a single-unit operator and you're trying to grow your business, how would you think about, uh, would you focus all on your business and trying to scale it to multi-unit, or would you save for retirement?

1:01:36How would How would you do that? Well, let's define what does it mean to be rich, okay? Okay. And I think the way we look at it is when your assets put enough money in your pocket that it pays all your bills, then you're rich 'cause you're not working for money anymore, your money's working for you, right? Okay. And so if, and I have another client, you know, and I think this is relevant to certainly small business, certainly a one-unit operator, he would say, and a huge business, by the way, he would say, champ, we're all one lawsuit away from bankruptcy.

1:02:12Yeah, that's for sure. I love that. He was a big believer in diversifying away from the business. Now, you're not going to get a better return if they're following your process and doing it your way than to put money back into the business. I'm a one-unit operator, and if I perfected the way you guys teach them to make money and manage the process, then it makes perfect sense that you start thinking about your next unit and then possibly the next one.

1:02:42But most wealthy people don't have all their eggs in one basket. They're still going to take some of that cash flow, especially after they get established and get a little comfortable. Like, I've figured this thing out, I've got good management. I'm not having to kill myself anymore. Now I can afford to start to diversify a little bit. And so yeah, it won't necessarily just be the S&P 500.

1:03:08We'll start to diversify that and add some bonds for stability, not just be in large cap. And it's getting to be the S&P 500 is highly weighted now to those huge tech hyperscalers. When OpenAI and Anthropic go public, the top 10 companies in the S&P 500 are going to be 50% of the value of the whole stock market. So we don't want to put everything in the S&P.

1:03:37So anyway, we diversify for our clients and have some liquidity and some wealth growing outside the business so they have balance. And then, you know, again, the wives are all nervous. If something happens to you, what are they going to do with this business? So knowing that there's some money set aside that can help maintain the family's lifestyle if something happens, you know, to you as the operator, you know, that gives a lot of peace of mind.

1:04:08And then the other thing is we do— and I don't mean to get off track, but, you know, When you have insurance on your cars and your home, you can get an umbrella policy super cheap. Years ago, I got one for $5 million and it's $7,500 a year. And it was meant to replace income if I died early. And that's— and it's after I did it for 20 years.

1:04:33After 20 years, it's gone, right? But that's also sleep at night in addition to diversifying and keeping the family and your wife and everybody happy. And so yeah, we will start to help clients think about that. And then as you get to be multiple locations and you get to be further down the lifecycle of the business and you're starting to think about the exit, that brings a lot of other complexity.

1:05:00And so we're talking to clients about setting up estate plans, and estate planning is just taking the assets that are going to grow the most, and get 'em outside your estate where they're growing outside of your estate, out of your own tax ID number, so that you're not having to pay the 40% estate tax on all that future growth. Because if something grows at 10%, it's gonna double every 7 years.

1:05:27So whatever assets we have today, if they're growing, and again, the S&P's been growing at 13 for the last 10 years, I'm not thinking about how big that could be in the future. So if I have a $20 million net worth and it's growing at 7%, in 10 years it's going to be $40 million. In another 10 years, it's going to be $80 million.

1:05:50And that's more than the— if you're married, the combined $30 million lifetime exemption they take off the top when they calculate your estate that you get to pay 40% on the extra. So in advance, and certainly if you're opening up a new location, you have kids, you know, start the new location by gifting them some shares. So all that growth in the new locations, and they can be separate LLCs, your family's gonna get that growth, your children will get that growth, and it's not inside your estate, and it's not subject to 40% gift tax or a 40% estate tax.

1:06:26So yeah, we want to potentially give shares in our business to our kids, and that can be discounted too for lack of control and a minority interest and no voting rights and all that so that it takes as little amount as possible away from my lifetime exemption. It's $15 million for me and my wife. But anyway, there's lots of things we do to start transferring stock in the business, ownership in the business, the kids pop, the kids in their trust doesn't hit my estate, no gift tax.

1:07:02And either way, you know, when it's doubling, you know, that could be a whole lot of tax we're not paying 40% on, right? And then the last thing I would say to think about is people are always worried as they start to accumulate wealth. I mean, when you have multiple locations and all these people working for you, You can't hide from your family that you're wealthy.

1:07:25And every family's worried, if we talk about wealth to our kids, then they'll think I'm privileged and it'll ruin their ambition and they won't want to work and they'll just wait to get their money. And that happens, but it's not money that ruins kids in our experience. It's parents that ruin kids and they ruin them by not talking about it. So it's the opposite.

1:07:48The more you talk about it, the better, as long as you also include your values, how you created that, and your expectations on what you expect from them for them to participate in it. And when you do that and they've been spending their whole life trying to not disappoint you, they're going to work extra hard to not disappoint you so they have an inheritance.

1:08:08But if you don't talk to them, what happens is they fill in the number, the blank with whatever they think the number is, which is not correct. And then if you don't talk to them about expectations, then they'll assume there are none, and that's how they become messed up. And so yeah, having— and we start with talking about, here's buckets of money just so you know.

1:08:33And oh, by the way, we've got your college covered and you don't have to worry about that, but it could be a long time before we die, so you might have to wait a long time before you get any money. So I highly encourage you to go and do the best you possibly can so you're not waiting 50 years when you're an old man for what I worked for my whole life.

1:08:51And then as they get older and more mature, you can fill in the numbers of the different buckets and then start to talk to them about what they will get and at what time and what's expected and the limitations that are put on that in the trust and what you've hoped that they do, which is just be a good human, work hard, be productive, and pay it forward.

1:09:13Uh, you know, but there's a lot of kids that get all jacked up with money because they think they have to outdo their parents, and that's not true. And then they think they got to do it on their own without asking for help so they don't have to feel guilty, then they earned it on their own like mom and dad did, and that's, that's not true either.

1:09:30We just want you to be a good human, and we want you to work hard and be productive and be happy and pay it forward. And when you have those conversations and you talk about what you value, then it changes the dynamic and it empowers them and makes them feel proud. And if somebody asks them about their money, then you just simply say, hey, my mom and dad worked incredibly hard.

1:09:55They value X, Y, and Z, and they give back to the community, and I could not be more proud of them. And yes, we're very blessed and fortunate. And then that's all you have to say. And guilty is when you did something wrong. We're not doing anything wrong. We're just going out and living life to the fullest. And, you know, the meaning of life is to figure out what your God-given gift is and the purpose of life is to do the most you possibly can with it.

1:10:17And that's all we do. There's no guilt involved. You know, we didn't throw away our opportunity, right? Yeah, 100%. So yeah, I love what you're saying. So to reiterate, so single unit operator, you're probably not gonna get the best return. By diversifying, but you'll be able to sleep at night. And I know Glenn, he's a partner of ours, he's very big on the insurance policy, you know, to have income replacement for your family.

1:10:45And then the final part, the multi-unit, preparing your family maybe for an exit, maybe a lot of our listeners might not think that that's attainable, but there are a lot that maybe do. There's a lot of people in our business that are service advisors that want to grow in their career and open up a business one day. And we've just got a lot of case studies of business owners that have come through our training that are in their late 30s, late 40s, and they all of a sudden go from $300,000 or $400,000 a year of EBITDA to a year later doing $1.5 to $3 million of EBITDA.

1:11:20And at that point, you're kind of, even on a reasonable multiple, if you have $2 million of EBITDA, you've got a super high net worth compared to maybe not very long ago. And if you can take some chips off the table and compound that at 8%, by the time you're in your 80s, you've got a tremendous net worth, like crazy, unimaginable for a lot of people.

1:11:44And I know there are certain people that are listening to this that do believe that that's capable, they're capable of that, even if they're just a service advisor right now in their 20s or 30s. So I hope whoever's listening to this, I hope you know who you are. But the answer, I love that you touched on it, how do I not ruin my kids?

1:11:59Like, if you have that kind of net worth when you're at that age, I think what most people will do, what you're saying, is they kind of just don't talk about it, and the kids figure it out for themselves, and then they make assumptions on what they're gonna receive or not receive. And, you know, something we say in the business is, if you don't tell your team members how much money the business is netting or making, they automatically assume it's on average 6 times more than it actually is.

1:12:25And so I can imagine kids are probably the same way. It's like, well, I see this big house we're living in. I must be getting all this money, you know, when you guys pass it on. But I think transparency is probably super effective. So we always get this question, you know, how much is enough to leave for your kids? And the answer is however much you prepare them for.

1:12:46You know, it's kind of like the same as what you were saying. And, you know, when I think back of when I started, you know, in my career, I wasn't a technician, but I was just this salesman with a desk and a phone. And they said, have at it. And I did it all wrong. And just like somebody that's maybe a technician that's starting to own their own operation, they didn't go to business school.

1:13:08Nobody told me how to be a salesman. And I was the guy with the brochure. I was maybe too aggressive. I was, let's just call it super enthusiastic. And I think the only reason I survived is I did have enough passion and enthusiasm. Maybe my clients felt sorry for me and they threw me a little bone. And that was enough to keep me afloat.

1:13:28And then when I learned the Sandler sales technique of how to be a professional, I mean, it completely changed my life. I mean, I never in a million years would've dreamed that we would have $7 billion to oversee. And I think what you're doing is the same thing when you teach somebody how to be a professional at this business, you know, that's so fragmented.

1:13:52And is executed so poorly on average around everywhere. When you learn how to do it at this high professional level, it just changes everything. And then hopefully you're starting to see growth and margins and bottom line and EBITDA, the whole thing. And ours is the same way. I luckily learned this process, changed my world. And I think as people learn your process, It changes their world.

1:14:22And I'm incredibly grateful that you asked me to speak about our way of thinking about sales and creating wealth and talking about future because with your playbook, I think there's no limit. And certainly in our world, as we got better and better at it, there was no limit. And again, never in a million years thought I would have $7 billion that we're responsible for when C student from the University of Texas with a degree in finance where my GPA just kept getting worse and worse the further I got along.

1:15:00I didn't know you went to UT. That's— yeah, you're welcome. Yeah, but on paper, I don't have— I don't qualify for the job I have, but here we are and we made the most of it. And I think you'd give everybody the same exact opportunity. Yeah, and there's case studies, you know, people at Todd's old company that were restaurant managers in the, uh, '90s that he recruited I know multiple that went on and started their own chain and sold multi— I mean, I think there's a couple of them at least that are over 8, maybe 9 figures in net worth, but obviously they had to work for it for 30 years.

1:15:33It doesn't come easy. So anyway, I'll leave you with this final question. You may or may not even be able to talk about it, but any market outlooks for us regular people? You think it's just super overheated? And overvalued right now? There's definitely parts of the market that are overdone. The difference in the tech bubble in '08 is the companies didn't make any money.

1:15:55Now these big tech companies make massive amounts of money. I just read in the Wall Street Journal today that first quarter earnings are supposedly up 28% year over year. Now, a lot of that is coming from those huge tech companies, but are they overdone? Yes. Have we run them up too quick, too fast? Yes. Are they going to keep spending money on AI like crazy?

1:16:21This year it's supposed to be over $700 billion spent on data centers in one year, and it's going to be multiple trillions at the rate they're going. And is there a trickle-on effect to lots of different businesses that are tied into that? Yes. And is everybody making money? Yes. And the reason we haven't had inflation is because the labor market is strong.

1:16:46It's as good as it's ever been. 4.3% unemployment is literally as good as it gets going back 70 years. So everybody's got a job. We're making enough money to keep spending money, and companies are making money with record profit margins. And so can this continue? Yes. Does it go in a straight line? No, it doesn't. Right. We'll know when it's coming to an end when— I mean, we're probably already euphoric in certain areas.

1:17:15I mean, the whole thing. For sure. SpaceX, they lost $5 billion and we valued it at $2 trillion. I mean, how is that possible? Yeah. It's adjusted EBITDA. They depreciated the rockets. It's just crazy. I saw a tweet that was, Elon Musk is a trillionaire on $8 billion of EBITDA. This is so crazy. That's crazy. So, so there are areas that are gonna, you know, come down a little and adjust.

1:17:41It's not gonna necessarily take down the whole market. And I'll just leave you with this: as long as the consumer has a job and is making money, uh, and continues to consume— I mean, GDP is 68.5% of consumption, is what GDP is in America— as long as we can keep that going, then we'll keep advancing. And then when we start to see see the labor market weaken and consumption go down, and the recession will probably come.

1:18:06But the recession is not on the radar today. Well, that's exciting to hear. Uh, I'm gonna take that to the bank. No, I'm kidding. Uh, I, I'm, I'm certainly not a financial professional at all, but I, uh, I'm optimistic. I'm just a bull. I, I just think AI is so transformational, some of the things I've seen. Um, and I just, I hear, I hear what you're saying.

1:18:27It sounds like the companies that are super profitable like are the ones paying for all this stuff. So it's not like, I guess Oracle could go under or like Anthropic or OpenAI if it really hit the fan. But like Google's making $100 billion a year or something in earnings, you know? So the line continues to go up and to the right. I think it's definitely super euphoric feeling sometimes.

1:18:51So it's like, oh, we gotta be getting close. But all right, well, that's been it. I think that's the pod. I learned a lot today. So Champ, thanks so much for the time. Really appreciate you. And yeah, I think that's the pod. All right, Joe. Thank you, sir. It's been an honor. Appreciate it. All right. All right. Take care. For more information, reach out to Todd Westerland at 925-980-8012 or visit autoshopanswers.com.

1:19:18You can get more information about Key to Key to Callbacks, Courtside. We have a VIP Rack Attack Day where you spend an entire day in the trenches with our team learning this perfected business model. Uh, we offer leadership classes, we have an AI academy, and also get more information about auto shop callbacks. Uh, we have auto tech training. We are literally your one-stop shop.

1:19:39Once again, that number for Todd Westerland is 925-980-8012.