Joe Koufman

There's a guy named Greg Crabtree who's written a book on labor efficiency ratio.

He's an accounting guy.

What was his name?

And he says that Greg Crabtree and the book is about he's coined this phrase labor efficiency ratio.

And it's the idea that you should be hovering between two point five and three point five.

So that for every dollar you spend on payroll, you should be bringing in between two and a half and three and a half dollars in terms of revenue.

And one of the things that he says is that as a CEO of a company, if you're not pulling out the salary that you would be making as a hired for gun CEO somewhere else, then your business isn't profitable.

Well, you know, absolutely.

We watch that ratio and it's a valuable ratio as you grow to know when to hire the next person, right?

Because you want to keep your ratio in balance.

And it tells you either if you're running too hot with a high ratio, then it means that you're burning your people.

And if you're running too low, then your profitability is really suffering and you've got too many people.

So it's been a helpful tool.

Like 40%.

Um,

Well, yeah, I'm going to probably reinvest most of the money into the business because there are two types of entrepreneurs in the world, those that want a family business and those that want a growth opportunity.

And this is a growth opportunity for me.

I'm not a family business guy.

Yeah, I think five years and then sell.

Yeah, and it's funny because we've had some interesting offers along the way.