Three lessons for accountancy learned from CNBC's The Profit and Marcus Lemonis

It’s no secret that I’m hopelessly addicted to turnaround shows like Bar Rescue, Restaurant Impossible, and everything in between. Lately I couldn’t help but notice that CNBC’s The Profit with Marcus Lemonis has a very direct correlation to what I’ve seen changing in the accountancy and advisory world.

Accountants, bookkeepers, and consultants have been faced with a new challenge: providing proactive advisory services to their small and mid-sized business clients to help them thrive. There has been a recent increase in demand from small and mid-sized businesses for more access to high-level financial insights and strategic business advice.

In Season 2, Episode 1 of The Profit Marcus Lemonis says, “small businesses are the backbone to this country’s economy, but every year over 10,000 of them fail.” While I agree with his statement, I believe it is actually much bigger than just the United States’ economy. I believe that small businesses affect the global economy more than most realize. And the accountants, bookkeepers, and consultants who serve as advisors to these businesses are the ones who can effect positive change.

I found myself taking notes every time I watched (or binge-watched, if I’m being honest) The Profit and started to realize that there were important lessons to take away that can be translated to accountancy. The feeling that I was learning was reinforced when I got a chance to meet Mr. Lemonis and hear him speak at the UPS Small Biz Salute on May 4, 2016 in Minneapolis. While Marcus was scheduled to speak for 15-20 minutes, he was up in front of us for almost an hour, and I have to say he was one of the most interesting and relatable keynote speakers I’ve attended in a while.

During the Q&A session towards the end of his talk, someone in the crowd asked him why he started doing The Profit TV show. His answer had two parts. First he did the show to prove that the underdog can win. And secondly, because “it’s a curriculum,” that uses visuals and real examples to help teach the audience.

While there are probably many more lessons to take away from his work, I have categorized my thoughts on The Profit into three lessons for accountancy.

1. Creating efficiencies is important

2. Building trust is your most valuable asset

3. Small business owners need help with their financials

Creating Efficiencies is Important

When Marcus Lemonis came into SJC Drums in Season 3, Episode 1 of The Profit, I realized that building a business is like building a custom drum set. When your workshop is disorganized and management keeps switching project priorities, things start to collapse. But putting a process in place gives you room to build better, faster, and more.

The same goes for an accounting firm. Implementing tools that simplify and automate your tasks and services can help you become more efficient. Efficiency in any business promotes growth and a cohesive work environment.

Besides just implementing tools or systems, you can create efficiency by maximizing your employee’s talents! Employees truly are any company’s biggest asset. In our SJC Drums example, Marcus was able to help turn around the business by putting the right people in the right place. It wasn’t easy, and it took some counseling and mending of broken relationships, but once things were in order the magic really started happening.

Mr. Lemonis did the same when he went into Key West Key Lime Pie Co. He found that one of their best employees, Tami, was working another job as a bartender in order to support her family. He realized that if he could promote her and pay her a salary that would eliminate her need for a second job, he could not only improve her life, but also improve the company’s productivity. By putting the right person in the right position, he was able to make Key West Key Lime Pie Co. very successful.

Accounting firms, whether big or small, have employees who all have unique and different talents. Being able to understand where your employee brings the most value and putting them in a position that makes them successful will bring your firm to the next level.  As Marcus says, “if you’re going to have a successful business, you have to have people on the team that actually love the business and care about it as much as you do.”

Building Trust is Your Most Valuable Asset

In Episode 218 of The Profit Mr. Lemonis discussed why he does business on a handshake.

“Why do I do deals with a handshake? I believe deals are built on trust. That’s more valuable to me than a piece of paper.”

By focusing on building trust with his partners, he is able to use that as a building block for their success. At the UPS Small Biz Salute event, Marcus spent a lot of time discussing trust, vulnerability, and communication. He said, “the key to business isn’t being brash, it’s being relatable.”

When you are able to relate to someone, you can form a bond or connection, and that brings trust. As an advisor, when you communicate with your clients, it’s important to be transparent and honest. This helps create a strong relationship that makes you an integral part of their company’s success.

Historically accountants and bookkeepers would only have a couple touches with their SME clients each year; at best they would be connecting monthly. But it has become so easy to introduce cloud technology, apps, and tools that can increase that communication and keep your relationships strong. Being able to monitor your clients on a daily basis and understand how to help their business, even before they realize there’s an issue, brings a huge advantage to your firm.

As Mr. Lemonis said at the Small Biz Salute event, “the world doesn’t revolve around business,” it revolves around relationships.

Small Business Owners Need Help With Their Financials

One of the first episodes that really made me aware that I was learning was in Season 2 when Marcus sat down with the owners of Courage.b Boutique. He showed them their financials and helped them look at the multiple locations they have to compare each store’s success. It was a wake up call to learn that these business owners, and many more like them, had not done this before because they did not have the tools or resources to do so.

Small business owners are faced with a unique challenge: who to talk to about their money? They can’t talk to their employees, or they might create a dysfunctional work environment. They probably don’t want to talk to their friends, and if they talk to their lawyer, it’ll cost them by the hour. But they can turn to their accountant or bookkeeper. Their financial professionals already have seen the numbers and know what’s going on in the company. Whether they started with simple bookkeeping or tax services, there is the ability to expand this into providing more help that is critical for the business to succeed.

This idea was shown in Episode 302 when Marcus Lemonis introduced us to Dan, the Consultant he hired to help manage Coopersburg Sports. Finances are complicated, the P&L and Balance Sheet don’t always show the full story. Small businesses really benefit from the same kinds of financial information and insights that large corporations and Fortune 100s get from their CFOs and FDs. However, small businesses cannot afford the traditional price tag that comes with those services. But, like Dan the Consultant, the availability of these services is becoming more attainable for SMEs through consultants, bookkeepers, and accountants.

Final Thoughts

At the Small Biz Salute event, Marcus Lemonis said that his goal is “to make business cool again.” I believe that all of these major shifts in the accountancy and advisory world are a huge push towards that same goal.