Podcast Episode 5 with Transcription – Rem Oculee

Rem Oculee:

Welcome to the Exit Mindset Podcast. I’m Rem Oculee. Many years ago, when I was trying to sell one of my companies, I couldn’t get what I thought was the right price for it. I realized I had things set up wrong, even though the company was profitable. So, I spent years researching and studying exit strategies to improve my company valuation. And I discovered, the same process that improves valuation would improve business profitability and give me more free time. And here I am to show you what I have learned. You see, the best way to grow your business is to look at it from the perspective of someone who’s going to buy your company. Once you start thinking that way, magic happens, and you start seeing things you couldn’t see before. But that’s not all, I also discovered the three principles that you must know to command a better price for your company. These principles are your product, your infrastructure, and your conversation with the consumer. Once you master these three principles, you will be on your way to increasing your profits, and your company valuation, and get more work-life balance through your free time. I will teach you through this podcast, lessons from the trenches, and we will have dialogues with some of the greatest minds on the planet.

So today we’re going to be talking about the conversation, and the conversation is one of the foundational components of an Exit Mindset. So, let’s get started here. Many people define the conversation as the verbal and written component of dialogue with the consumer. But in the Exit Mindset, I propose to you that this is only a category of the total conversation you’d have with the consumer. Because conversation, as far as your company goes, is all the verbal and nonverbal and non-written conversation you’d have with the consumer. Everything you do and everything everybody around you are doing in your company, speaks volumes to the consumer. Any action you take, anything you add to your company, any configuration you create is saying something to the consumer, and that’s why we call it the conversation. Simple case in point, if you decide to change the color scheme of your location and the consumer interacts with your location, the choice of that particular color speaks volumes to the consumer.

So, let me just make a simple point, just to be clear about that. Let’s say you’re a law firm and you decide to paint your walls with the color purple everywhere. Everybody works in, its purple. Do you think that speaks something to the consumer? I believe when they walk in, they have a question in their minds because you create a conversation with them. You told them that these are the colors that are a choice of our establishment. This is what defines us, and they’re going probably, why is it purple? And the answer to that, they go, well, maybe they like purple. Maybe they, uh, maybe purple signifies something. Maybe they’re trying to create a statement. They might say to themselves, this look like a, like a shop, like a store, maybe. It doesn’t look like a law firm. But in the end, you’ve spoken to them.

You said something to them. And through that statement, that is not verbal. You create a dialogue in their head, between you, on them. Based on that, they might make some decisions. So, they might say, well, what kind of a law firm is that, that they paint all the walls and purple? It sounds kind of nutty maybe. But if they walk into a store and this is all purple, they think, oh, that looks cool. So, as you could see how you do these things, how you make choices on some of these things, determines what people think and the engagement of that conversation that they have with you. And while you were in there talking to them, while you’re in there asking them questions or, or, or suggesting anything to them, why did not show them anything written. You spoke to them through that one item, which is the color of your walls.

Now let’s take that a little bit further. So that’s sort of a simple example why, why you can take anything in your business and by creating it a certain way, we create a dialogue with the consumer. Written conversation, such as your advertising and such as your radio, say, for example, show or whatever you’re doing. It’s just part of it. A lot of people confuse that, they think this is it. It’s just what I say to them. But from an exit-mind perspective, the fact that a buyer would come in and look at all these things and find out that the way you configured everything is creating some sort of a dialogue that the consumer would appeal to the consumer, or may not appeal to them, is a determinant of how well they value your company. So if you walk in and if you’re a buyer and you walk into a company and you see that there’s in congruency, and that’s the key component, by the way, this, the key word in the whole thing, in congruency between what, how you appear to the consumer and between what you propose to them. In the end, you are going to think that maybe you don’t know what you’re doing, and maybe I should offer you less.

And if that happens, again your valuation is going to go down. Your exit isn’t going to be as big as it is. But again, you know, there’s one more factor to this if you look at it from a different angle. If that happens, wouldn’t you say you’re probably acquiring less customers? The answer’s probably yes. Most likely, yes. Because you’re going to get the consumer that is, that has a perception of this kind of establishment to work with you because they probably would be confused. Now, you can also agure with the other way around. You can say, well if some people definitely like the color purple, maybe you are targeting the people that like to look at a law firm as if it’s a store of as, as if it’s a clothing store that is sort of, uh, hip. Maybe you wanna do that. But then if you’d done that purposefully and you’re using your other messaging to attract those kinds of people, and you’d be the law firm for the people that liked to come into a law firm that looks like a store, think good, excellent.

You did it correctly. Your conversation with the consumer that you’re looking for has been achieved in a proper way. And I’m just talking about that point because there could be a hundred things you could do within your company, or within your business that could create a conversation and a dialogue with a consumer, without you even knowing you’re creating a dialogue. Some of the simplest things in the world, you could think about how your employees present themselves. So, I’ve seen companies that perhaps there is no exact way of dressing. One person is wearing a suit, the other person’s wearing jeans and t-shirt, the other guy’s wearing something else. And there’s just you know, no consistency. And in my opinion, again, it could be in my opinion, that creates incongruency. I think people should have a standard because the way you present yourself to the public has to be consistent.

And it doesn’t mean that if there was anything wrong with it, it doesn’t mean that that’s bad or wrong or creates anything negative. It just means that you did not think it out clearly. So, if you look at some of the major corporations in the world and how they present themselves, you’re gonna find that the conversation they have with you is very specific. And they spent endless amount of time, sometimes. Just looking at ways to make sure that they converse with you without talking to you directly. So, a simple case of point let’s takes a place like Costco, as an example. Costco positions itself as a warehouse type for the consumer. So they positioned themselves as a bulk warehouse style ‘B2B’, but there for the person that doesn’t have a business, perhaps, and some do, but anybody can go to Costco. Notice what they do. They set up the entire location as a warehouse, the entire facility looks like it, and they go to pains to make it like a warehouse, watch the pain.

Do you think Costco doesn’t have the cash or the money to make some nice paint on the walls? You think they cannot take the roof on the ceiling and just turn it into, instead of there just no ceiling put a ceiling up there. I know it’s about probably 30 feet maybe up there, but they could do that easily. They could do a lot of things to make this a little bit more like a store, that’s a little bit less of a warehouse and more of a store. But then entire purpose behind it, in my opinion, is just to create a positioning that we are warehouse. And by the way, you’re going to get no frills. And how does that play into the consumer’s mind? They’re telling the consumer that you’re going to walk in, you’re going to get warehouse prices, warehouse quality, warehouse, uh, quantity.

And when you walk in, it’s consistent, you do not see a valet parking in front of Costco. Why? They could put them in for you. But what would that tell the consumer? What conversation would they engage a consumer for their valet parking? Well, we are high level establishment that gives you convenience even to take your car and bring it back to you. They don’t want that. They’ll want to show you that when you walk in, there’s somebody standing at the door, checking your ID. That all those sorts of warehouse style carts, warehouse style equipment, and things in the front, pallets, you name it, are in front of you when you walk in. And you feel like you’re walking to warehouse. And anything that take away from that would take away from the conversation they have with you. I’ll make a bet with you. If you walk in and you see any of those elements violated, you’d find it to be incongruent.

You start questioning it. You might go. Why? Why am I here? Okay, why are they spending money on this mess? Must be going out of my prices in here because I’m paying higher price because of, you know, they’re spending money on painting the walls and making it nicer. And I got a greeter at the door and I go to somebody to take me to the, to the aisle. You can’t, I don’t know. I don’t even know if you can find any way to take you to the aisle in Costco. Maybe there is maybe there isn’t, but if there is, I’d find it difficult to believe that they would. So probably not. Uh, so again, everything you walk in is congruent. So the conversation is not just the advertising. Again, it’s all the things that you do. So, what do you do? You gotta look at your company and first of all, you gotta do one thing, dissect your environment. Dissect your interaction with a consumer and try to understand everything you do is a piece of the conversation.

How the facilities look, how the product looks, how you package the product, what kind of product it is, even that as part of the conversation, what’d you offer the consumer? You’re advertising. That’s also one of it, it’s positioning. So, the way you position your product one way would create a different perception and a conversation with the mind of the consumer, then had you done it a different way. And you could create a third way to have, to position your product, which would create a third type of conversation. Your job is to figure out which is the one you want, which is the one that’s optimal. And lots of times you’re going to find what you want to create, when it comes a conversation, is not necessarily what should be. In my opinion, what should be is what the consumer wants at the end of the day, that gives them the most value and result they’re looking for.

Again, let’s take an opposite example. If you walk through an establishment, let’s say, high establishment. Let’s say like, like perhaps Louis Vuitton, would you expect a warehouse? Would you expect unpainted walls, or would you see a pallet with a bunch of Louis Vuitton bags on it? Of course not, you barely see one. They have one on the floor and pretty much if you take it, that would be it because it’s so valuable. But again, the conversation they’re having with you is a lot different than the conversation Costco would have with you. Does that make Louis Vuitton better than Costco? No, of course not. Neither is Costco better than Louis Vuitton. None of, no business is better than the other. Each one is designed to optimize the conversation they have with the consumer. And it’s on you to decide what is that best conversation.

Now, there are two things could happen with a conversation. One of them is that you have missing conversation. The second thing you could have the wrong conversation. You gotta be cognizant of difference between those two. So, missing conversation, is that something you could be telling your consumer by way of messaging them verbally or non-verbally that is missing that you just don’t have it. You should think about putting it in. Now, the second one is the wrong conversation. So, you might be saying something non-verbally through your configuration, through your infrastructure, through the way you displaying your offer, your company to them. And that thing is not exactly the optimal way of having conversation with them. So again, go back to the lawyer example where we said, Hey, a lawyer has purple walls and that lawyer would look at it and go, well my consumer is probably looking at that and going, having a, having the wrong dialogue in their head when they come in here, maybe ought to make that say, for example, grey or maybe ought to make it white.

Maybe that’s more consistent with my image and with the conversation they would have with me. How does my reception area look in case of a lawyer? For example, does it look high end? Does it look average? Does it look ragged? Does it look clean? Does it look, okay, do I put books in there? Do I put magazines? Are the magazines that are there old, and tired? I mean, I’ve walked into, into those kinds of professional services firms. And I’ve noticed that that magazines are sort of, you know, worn out and they just have a communication with me, they just, they just talk to me. They, they, they really said this, this is who we are. In my head, I’m going okay, I see who you are. So, you basically, you know, you’re the firm that puts this thing in here. You showed me that you do not care about what goes in the front of the, in the, in the waiting area…

And based on that, maybe it doesn’t bother me, but I guess that’s who you are. Sometimes I look at it and I go, okay. They look like probably professionals, but they’re just busy with their work. They really don’t care much about what goes in the front of the client, customers or clients when they walk in and therefore, they just probably have no, no care, and maybe they’re good. Obviously, there’s a degree of lack of care in there for what goes in there. I would tend to think their work, it’s a little bit of a reflection on their work. I would tend to think that. That their work may not be as, as immaculate as a company that would walk in and they always have fresh new magazines in there. Sometimes it’s, it might be even better if they just don’t have them. Sometimes better if you just kind of just let it go because you create an impression in my head.

I definitely think when I see it, when I see the old/tired magazines that they don’t care, and it’s kind of reflective of like sort of a tired operation. That’s how it looks like to me. But if I walk in and it’s really immaculate, new magazines, it looks like safe. It’s fresh, the environment is good. I think, I tend to think that they care. I tend to think that they’re up to speed on what needs to be done. I would probably trust them more. So again, that just depends on your outlook. Now you get people that don’t care and the conversation, certain consumers don’t care. If certain consumers would, might look at the fact that you replace the magazines and it looks immaculate, that I’m being charged somewhere, somebody is doing all of the work. Somebody’s taking care of things and maybe I want to be somewhere with no frills where it’s just, they just throw in a few magazines and, and uh, it’s over.

And I must be getting some good value in there because those people are just, you know, kind of going to do the work and they’re slow probably, and not thinking too much about it. But they do the job for me, and I’m sure the prices are going to be great for me. Again, there’s no right and wrong in this, and I’m only bringing the magazine example as a sort of a slice of what the overall big picture is when it comes to the conversation. So, if you take that example, mini example, and apply it to everything else. From the way your establishment looked, from the way your employees dress, from the way you greet your, your customer, from the way you paint your walls, from the way your furniture looks, from the way you advertise, from the way you talk to them, from the way you offer them the product. You name it.

I could name you 70 things probably that you could look at and interact with a consumer a certain way, that if you change, you change the entire perception. So, the definition of that would be anything that would change their perception of the consumer about you, is a conversation you’re having with the consumer. So, the conversation is not something you do in the beginning. That’s a very important point. Conversation is something you must carry through. So, even if you have a beginning of an operation from an appearance standpoint, done a certain way, that is appealing to your particular consumer. Remember that’s the key operative word. It’s not about every consumer, it’s your consumer, appeals to them. You get to carry that through throughout the process. So, now you gotta examine the entire infrastructure of your operation to see if it actually matches with your consumer expectation. I mean, let’s say you have everything dialed out correctly.

And then in your customer support, after they buy the product and they’re done, and they go home and your customer support. There’s something in the support, part of the operation, that is incongruent with everything you’ve done, and it happens sometimes. Guess what’s going to happen? The consumer is going to notice that. And in the end, they’re going to decide that maybe I don’t like that company, because what they’re offering me here is not exactly compatible with what I’ve seen across the board. Ultimately it takes one drop of ink to ruin a great glass of water. And if your conversation with them gets incongruent, one part is going to reflect the entire operation. That’s why it’s so important for you to study that carefully. And throughout the Exit Mindset Podcast, the book, and other things we’re going to be doing, we’re going to show you how you could develop that process into something magical, something that the consumer can feel good about.

Now, let’s take that to the buyer of the company. It’s exactly what’s going to happen with the buyer of the company. When they walk in, they’re going to see those things, and they’re going to notice them even more. Because they’re coming in with an eye, is, is this really a good business I should be buying? And if that happens and they see then incongruency, in your, in your conversation, again, that devalues your company or creates a company that is probably not purchasable. So again, we always go back to this point, sort of the feedback loop. You’re creating, you’re doing these things to create more profit for yourself, which creates more time, and ultimately creates more valuation to sell the company if you want to for the right price. But by doing these things, when the buyer comes in, they’re going to offer you the right price for the company, which ends up being an added bonus.

So even if you’re not planning on selling your company, in the end if you go ahead and do these things, you’re going to get much better business model. You’re going to have greater time, more fun, more excitement, and better team and better enjoyment out of the whole process. So, let’s end this with what I call a mindset moment. That moment is called, put the pressure on immediately. So, what I want you to do is right away, as of now, start looking immediately at your conversation with a consumer. Trying to the extent that you can, dissect what you have. And next few days, all you need to do everything you can to see if your conversation, the verbal and nonverbal conversation with a consumer is congruent, and if there’s anything that needs to be changed. Don’t do it a week or two weeks from now because the pressure is off, do it in the next few days.

Thank you, and we’ll see you on the next podcast. I’m Rem Oculee. Remember, action is everything. Use it or lose it.

You’ve just listened to the Exit Mindset Podcast with Rem Oculee. If you haven’t yet subscribed or followed, please do so in your podcast listening app. Or better yet, visit exitmindset.com to join the conversation, access the show notes and discover our bonus content. Lastly, we want to help as many business owners as possible. If you know anyone who could benefit from the information given in this podcast, please feel free to share it with them. Until next time…