One of the biggest lies that contractors believe is that the answer to all of their problems is that they need to scale their business. Hey, it's Brad here. It's 2026 and you're still using a tape measure and grid paper to do your drawings. That's why I'm excited to tell you about today's sponsor, iGUIDE. With the iGUIDE Planix R1 camera and laser system, you can capture an entire home in about 45 minutes. all of your measurements, photos, and a detailed floor plan all at once. No hand sketches, no guessing, no more. Was that wall 10 foot or was it nine foot? Or, oh man, I forgot to measure the window offset. You just hit start and walk away. That's it. You're starting the job with accurate as-builds. And you can export straight to DXF, DWG, or RVT files so you and your team can get to work immediately. Miss something? Well, you don't have to worry about that because it's all right there in virtual land waiting for you. This is how you avoid costly mistakes. This is how you reduce change orders. And this is how you run a tighter operation. And more importantly, it's how you protect your margins. If you're serious about operating like a pro in 2026, it's time to upgrade. Go to hammerandgrind. com forward slash iGUIDE. That's I-G-U-I-D-E to order your iGUIDE Planix R1 camera today and start running your jobs the right way. Hey, welcome back to the show. I'm your host, Brad. And today we're talking about being busy versus being profitable, the lie that's killing your business. So in the intro, you heard me say that one of the biggest lies that contractors believe is that they're going to fix all of their problems by simply getting bigger. And the problem is like, you know, they think they need more leads, they need more employees, they need more trucks, they need more jobs, they need more revenue, they need more of everything. And they just believe that if I could just scale this thing up, man, it's going to finally work. And that is one of the biggest lies that you can believe. If you're where you're at right now on your in your business, if your margins are thin, if your systems are weak, if your owner, you is overwhelmed, the cash flow is tight. Fixing the scale of your business, growing your business is not going to solve your problems. You don't have a scaling problem. You have a profitability problem. And sometimes when you scale, it just makes the chaos even worse. It makes it more expensive. All right, so we're going to dive in here and really kind of break this down. I was going to, I was debating doing this kind of over-the-top intro where I was like, welcome to the world's greatest contractor podcast. And we're going to, you know, we're just the best. And I was trying to like overemphasize why everything, why we're so great. But I thought, man, if someone the first time listening to this and that's the intro, they're probably going to be what an arrogant SOB and they might turn it off. So I opted not to do that. The reason why I was going to do that is the first point that we're going to be talking about. And that is people believe, contractors believe that revenue is what's important. That revenue validates their business. Right. Everyone likes to throw out revenue. Man, we're going to do two million dollars this year. We're going to do five million dollars. We're going to do 20 million dollars this year. It's all about revenue, revenue, revenue. Listen, revenue is for vanity. Profit is for sanity. It does not matter how much money you generate in terms of revenue. It's pointless. It doesn't matter. What matters is what is the bottom line? What's the number on the very bottom? What is your net profit? How much are you putting in your pocket? How much is the business making? It does not matter what your revenue is. And too many contractors get caught up on this. All the time, I'm meeting with contractors and I'm saying, where do you want to be at? What's your goal? What kind of money do you want to make? And what I'm actually asking them is, how much do you want to make personally? Right? But I word it in a way because I don't, I want to see their response. I want to see how they're going to answer the question. And almost every time it's, well, I want to be, I want to be at $5 million revenue, or I want to, I want to get to 10 million. You know, they're currently at like 600,000, but their goal is 10 million, but they're getting coaching at 600,000 because they're not actually making any money. And so they believe that at 10 million, everything's going to be great. Right? And I always, my second question is always, why that number? Why 10 million? Why 5 million? Why 2 million? Whatever it is. And the answer is almost always, I don't know, I just thought that was a good number. Well, how do you come up with that? Like, how do you come up with a number that you think is quote good? Like if you didn't have access to the internet, and it was just you running your business, what number would you come up with? Where would you get that information? Where would you come up with that idea? You might be at $750,000 and think, man, that's great. I mean, if I can get to 1 million, that's super awesome. But because you listen to other contractors and this guy says, oh, I'm at 5 million. And this other guy's, I'm at 20 million. I'm at 50 million. And you go online, you see all these people talking about revenue, revenue, revenue. And they never talk about how much money they make. Never. Why? Because revenue is for vanity. I've talked about this before. Like you see other business coaches and other gurus out there that are like, oh, you know, I built a $200 million business and I'm going to teach you how to do the exact same thing. No, they're not. They're not. If you're at, you know, $800,000 right now, you cannot deploy a $200 million revenue business. You cannot. There are levels to that game. You're going to have to go through like four or five. different structures of your business in order to get the 200 million. You're not going to go from 800,000 to 200 million in two years. It's not going to happen. It's just not going to happen. So like a lot of that stuff is BS. That's why when someone says, I built this amazing business and I'm going to teach you the same, it's lies. It's not true. They're not because they don't, it's not about what they did. It's about what you're capable of doing. So I can give you, I can give you the exact. you know, the exact organizational chart or the exact systems and all this stuff to build a multimillion dollar business. But if you're not ready for that, it's not going to help you at all. So the revenue part of it is where people get trapped. They get trapped in this revenue. Screw the revenue. I would much rather have a, you know, $500,000 business and bring home $250,000. than have a $5 million business and make $100,000. Did you hear what I'm saying? I would rather have $500,000 revenue and make $250,000. And I know people that do this. I've talked to contractors that do this. And I'm like, I don't know if you need my help at all, dude. Like you have a really good business. Yeah, but I'm just bored. I'm just like, what? What do you mean? You have a cash cow. You're making crap tons of money. Well, I just want to do something else. I'm like, dude, I don't. I don't know what to tell you, but you're making a huge mistake because they have a cash cow and they're just bored with it. That's exactly where you want to be. You want to have a boring business where you make buttloads of money. But no, no, no, no. I got to have this high revenue so I can brag to everyone else I have this big revenue number. Well, secretly, I'm not making any money and I'm working my ass off. It's stupid. Don't get caught up in this revenue game. Screw the revenue. Revenue does not matter. Now, yes, if you have a profitable business at a low revenue and you're able to scale that, then yes, you're scaling your profitability. You're not scaling your size and you're not scaling your overhead. You're just scaling so that you can make more money. That's a different situation. But most contractors think that scaling or getting bigger is going to solve their profitability problem. And it's not. In most cases, it makes it worse. And in some cases, it puts you out of business. You have to be profitable where you are right now, whether you're a one-man show or you have 20 employees. It does not matter. You have to be profitable where you're at before you try to grow. I had an electrician call me one time. He's like, man, I need help with systems. You know, I'm just systems, systems, systems. And I'm like, okay, well, how many employees do you have? He's like, well, we're doing, I forget the number. It was like they were doing like eight or 10 million in revenue. It was a big number, you know, for most people. And he had like 20 employees, something like that. And I'm like, what's your profitability like? He's like, well, you know, we net like 8% or something like that. It was a really low number. And so the more and more I'm listening to him, I'm like, I don't think you have a systems problem. Now, you may have a systems problem. Like, yes, you may be losing money through inefficiencies. That can be true. But the way you solve. the lack of profit is not through efficiencies, it's through being profitable. And yes, if you are more efficient, which reduces the overhead, in theory, I mean, it does bring home more money, but it's not, quote, making you more profitable. This is why a lot of corporations are like, they'll just cut overhead. They're just like, hey, we got to cut $10 million out of our budget. And they'll go and they'll cut $10 million out of the sales team's budget. Because they need to save money. And so on paper, right, if you remove $10 million of expenses, on paper, it looks like you just made an extra $10 million. But you actually didn't. What you did is you crippled your sales team. Because you removed away all the tools and training and stuff they needed in order to sell. But on paper, it looks like you made more money. So yes, you can reduce expenses, which will generate more profit. However, if you're doing it just to make more profit, that's a problem. If you're trying to reduce expenses just to make more money, that is a problem. You can reduce expenses to be lean. If you want to be lean, there's nothing wrong with that, right? You can be lean, you can be efficient, but if you're doing it because you're trying to make more money, that is a symptom of a problem, that you're not making enough money. Now, you can be overhead heavy, right? You can't have a fat cow and you can't have too much overhead. I did that early on and it was stupid. It really crippled my business for a while because I took on too much debt too early. And yes, that's a mistake. You shouldn't do that. And sometimes you have to cut your losses and get rid of stuff, right? But that's not what we're talking about here. We're talking about when you have a profitability problem and then you're trying to reduce your expenses because you're not making enough money. So the revenue to validate their business, right? Like I said, we did a million this year. We did 20 million this year. We're booked out for months. The busy. We're busy in revenue. Being busy doesn't mean you're profitable at all. And you can always tell this when I ask the constantly, hey man, how's business? Oh, we're super busy. I instantly know you're lying. Not that you're lying that you're not busy. I believe that you're busy. But you're lying to yourself that you're actually making money by being busy. Now, is it possible to be super profitable and busy? Sure. If you've done a great job growing your business and running your business and marketing, yeah, you can be both. But that's not the majority of people that I talk to. The majority of people I talk to are busy because they have to work so many extra hours and they have to work so many jobs just to make enough money to survive. That is the problem I'm talking about. I'm talking about the ones that think you got to work six, seven days a week. You work 12 hours a day because you need that money. If you lose a week's worth of work, you're screwed. Like you'll be a month behind in bills because you lost a week's worth of work. When you have ammonia and you're sick and you're on your deathbed, you're still out there trying to work because you got to, quote, make this money. That's not a good place to be. That's not a good place to be in your business, right? The problem with high revenue, by the way, if you're doing, you know, again, you can be doing a million, five million,10 million, it doesn't matter. The problem with high revenue is that it can hide poor pricing, low margins, inefficiencies in your business, bad leadership. If you're constantly busy, but financially stressed, That's a clear, clear indicator that your business is broken. If you're constantly busy, but you're financially stressed, your business is broken, right? Now, can you be busy and not financially stressed? Yes, that's a good thing. You know, be busy, not have any financial stress because you're making good money. But at that point, it's a choice. Like it's a choice if you want to work more. If you're making really good money, I mean like really good money, $200,000, $300,000 in your pocket each year. And you're doing that and you're like, hey, I want to make more. I want to make $300,000. I want to get the $500,000 in my pocket. So I just want to work more so that I can do that. That's fine. You're making a conscious choice to work harder or work more so that you can make even more money. Not because you have to, but because you want to. Those are different. When you have to do it just to make poor money. $50,000, $100,000, and you're just like, you got to work seven days a week just to make that money? That's a problem. That's not a choice. That's a must have to do. So we don't want to do that. All right, number two. Oh, one last thing. This is just a little saying for you. You can't deposit revenue in your pocket. You only can deposit profit. All right, now, yeah, she's like, well, Brad, what do you mean? I have money people pay me. It goes in my account. No, that's not what we're talking about. Let's trawl along a little bit here. Use your brain. You can't deposit revenue. You can't deposit a million dollars of revenue in your pocket. You can only deposit what's left over, the profit. That's what we're trying to get to. All right, so number two, what's the second point? Most contractors are just addicted to chaos. Truly, you're just addicted to chaos. Being busy gives you significance. Right. You think, oh, man, people love me. Look at how awesome I am. I'm in such high demand because I'm so awesome. It gives you significance. It makes you feel good that so many people need you because you're so busy. But secretly what's happening is you're the cheapest guy out there and they go and tell all their buddies, hey, man, this guy does great work, doesn't even know his own value. Like he's super cheap and he does good work. I would recommend him a lot. Like, you know, you can get. I mean, I had another estimate from a guy that was $10,000 more than this guy, and he did the exact same work. So like call him because he's much cheaper. That's what's happening with your clients. They're not telling you that to your face. That's what's happening. You feel good about yourself because everybody's calling you. By the way, that was me. That was for a long time. I was the best contractor at the cheapest price. I had like a 90% closing ratio. Everybody loved me. There's nothing better than finding a... A business that does high quality work and low self-worth doesn't know their value. They don't know their value that they're providing because you can get great things at a discount. Who doesn't want that? That doesn't mean that you're doing amazing work, like you have an amazing business. I mean, you can do great work, but that doesn't mean your business is healthy. Some contractors actually subconsciously create chaos because slowing down forces them to face reality. Some of you actually create your own chaos because you thrive in chaos, not because you have so much business that everything's chaos. You create it. This is why I say all the time, you're the firefighter and the arson. So when you create your own chaos, that's you being the arson. That's you setting the fires. And you do this subconsciously, not on purpose, subconsciously. You don't even realize you're doing it. right? The constant firefighting. When you're constantly firefighting your business, it prevents you from being able to do strategic thinking. It prevents you from building systems for your business. It prevents you from having financial clarity and being able to track your numbers and understand where things are in your business. When you're busy, the number one response is, Brad, I just don't have enough time to do my P &L. I don't have enough time to review my sales numbers. I don't have time to put in the data that I can track it. That's all BS. That's you not prioritizing what's important because you're subconsciously creating chaos that you think you have to take care of. There's nothing more important than tracking your numbers. The number of people, I mean, I have people that have been in the profit club for three years and I still have to twist their arm to look at their profit and loss every month. Guys, you should be looking at your profit and loss at the minimum once a month, the minimum. Ideally, once a week. You know how much I look at my profit and loss? Every single day. The first thing I do when I get in my office and I look at my, I open up my, I turn on my computer, open up the browser. I have all my browser saved, which by the way, hack. Put all your browsers into your startup sequence so that it automatically opens up all your browsers. I have all my browsers opened up in order. And I go from right to left. And after I do one task, I close it out. The next task, I close it out. The first thing I open is my accounting software. And I go through and I match all my transactions for the previous day or from the weekend. And then the second thing, immediately after matching all the transactions, I compare my profit loss to last year. Every day I do this. Not once a quarter, once a year, every day. Now, I'm not suggesting you have to do it every day. I'm saying a good frequency is once a week. The minimum is once a month. When you look at your profit and loss, it's a lag metric, meaning it's telling you what happened in the past. It's not telling you what's happening in the future. However, if you have, let's say you have a goal of doing $50,000 a month in revenue, right? That's your goal. And you have no idea because you don't track anything. You have no idea how many sales you do, nothing. You have no idea. If you were to look at your profit and loss at the end of the month, after it's been correctly, by the way, there's no point in having a profit and loss or accounting if you're not going to make sure the data is accurate and you enter it correctly. Data is only as good as the information that's put in. So it needs to be accurate and it needs to be on time. Guys, this is what you have to do to have a successful business. You can't just go out there and work your ass off and have no idea where you're at financially and think that's going to be successful, right? Corporate America, they have tens and thousands of reports that they do because they're constantly reporting what's going on in their business. You have so many departments and they're turning in their manager and they turn to their regional manager and blah, blah, blah. You have all these reports. Because those people are not on the ground there knowing what's going on. They have to rely on the reports to see what's happening. So what makes you think that you don't need to have reports and accurate reporting and look at it and analyze it in order to have a successful business? You can't. You have to do that. So when you look at your profit and loss, right? Again, you have no idea how much money you're making. You're just selling stuff you have no idea. You look at your profit and loss and it says revenue collected, right? Now, I said a while ago, I said $50,000 in sales. What I meant to say was $50,000 in revenue. Let's say you need to be at roughly $50,000 in revenue, money collected each month. And you look at your P &L from the previous month, and it says you did $30,000.
