Katie [00:00:02]:
Welcome to the AEC Marketing for Principles podcast. This show is designed as a conversation between sales and marketing principals to address trends, challenges and best practices that are driving growth for professional service firms. Through our collection of discussions with subject matter experts, industry legends and leaders, we aim to share thoughts and practical tips with our listeners and that you can use for growing your AEC brands. Hosted by me, Katie Cash, Senior Vice President at smartigies, the AEC growth consulting firm that’s been developing smart business strategies for design and construction firms since 2008. Hi everyone. Welcome to another episode of AEC Marketing for Principals. I am excited you have joined us for today’s conversation. If you’ve been around the industry for a while, you know that in aec, growth is often talked about in terms of backlog, project awards, maybe employee headcount.
Katie [00:01:03]:
But behind the scenes, there’s another conversation happening and I know some of you are kind of starting to think about what that might be. And yes, it’s that about risk, right? It’s about risk. It’s about margin hiring and whether or not all your efforts are actually paying off. So today I’m excited to be joined by Jason Krueger. Jason is the founder of Signature analytics, which is now part of Citroen Cooperman, a really well regarded CPA firm. Jason’s going to talk to us about the role of financial strategy in helping firms grow with intention. Right. Because we’re all trying to grow and scale our businesses.
Katie [00:01:40]:
We don’t want to be the fast to grow too fast and then have to fire. So if you’ve ever felt that tension between marketing and finance or you’ve really been struggling to make the case for your biz dev investments in your budget, I know we’re here at the end of the year. This is perfect time to have this conversation. That’s why this episode is for you. So, Jason, I don’t want to beat around the bus. I just want to jump into it. Let’s talk a little bit about that tension, the tension between sales and marketing and finance. Because we’ve been around the industry a while, we know AEC firms operate with this tension between those who are chasing work and those who watch the bottom line.
Katie [00:02:18]:
And we’ve all heard the saying it takes money to make money. But what does that really mean for professional service firms that are trying to grow and scale their business? They’re positioning for projects that, you know, might not be advertised or awarded for a year, two, five years down the road. So what does that really look like?
Jason Krueger [00:02:38]:
Yeah, thanks Katie, for Having me on really appreciate it. I think really it starts with, you know, defining and making sure that we’re aligned on what success really is. So how do we define success? Right. And so obviously you mentioned it takes money to make money, but at the same time we want to make sure that we’re maximizing how we spend our money to produce to maximize the results. And the first step is understanding how do we define what successful results actually are. And so when it comes to, as you mentioned before, with some level of tension between finance and marketing, but finance is historically my side, but I also started, as you mentioned, a firm called Signature analytics from the ground up and we grew to about 75 full time employees before we joined Citron Cooperman. So I have a lot of experience also running a business and learning and being a part of the growth and the business development and the marketing sides of that business. As well as I think we’re going to talk about as well is, you know, sometimes people think, well, marketing is just a black hole.
Jason Krueger [00:03:47]:
It’s you spend money and I don’t know what I’m getting out of it. Right. And so the key really comes down to in my mind is how you define success within the strategies or the activities that you’re looking to accomplish and then how do you measure that success and if you can get alignment on how you measure success, what success means, then you can work collaboratively to develop a strategy, develop activities, whatever it may be to go out into the marketplace and then measure and tweak along the way. What I found to be most successful in overall marketing and business development is consistency. I’ve seen, and I’ve had a history even historically of well, we’re going to do this and well that didn’t work. Now we’re going to do this and then we’re going to do this. And so it does a couple things. One, it confuses the market.
Jason Krueger [00:04:36]:
The second is you’re not getting any traction in what you’re trying to accomplish. So you may say, hey, we’re going to do this one off here and we do one off here and one off here. But if you know, ultimately you want to create that level of consistency so you can measure the results over a period of time, I think that’s what it ultimately is, you know, critical to get alignment on.
Katie [00:04:56]:
Yeah. And I, I love that we are not fans at smartergies of what we call random acts of marketing where you just kind of pilot and yeah, if you do something and it tanks, don’t do it again, like I’m not saying to do that, but consistency is really key. And, you know, it’s consistency and making sure your brand is unapologetically everywhere your client is. But you can’t just count on seeing them that one time at a trade show. Even if you consistently year over year, if there’s 11 months between when you see them again, it’s almost like you’re starting that conversation over again. And I love your suggestion on make sure you’re aligned around what success looks like and how you’re going to measure that success. But I know a lot of our listeners, they’re doing their strategic planning, their business planning for 2026. They’re trying to budget, they’re trying to, you know, make sense of where the investment for 2025 went and paid off, and they’re trying to make the business case for where to continue or reinvesting for 2026.
Katie [00:05:58]:
So with your accounting background, and I know you’ve worked with lots of construction and professional service firms from a consulting standpoint, maybe talk a little bit about what real financial accountability looks like for the marketing teams, for the development teams. You know, if you’re advocating for these budget line items, how can you make it easy for the financial team to say yes to you? Because they understand that, number one, this supports our vision, this is supporting, you know, our alignment around where our success is growing into. Maybe talk a little bit about that.
Jason Krueger [00:06:31]:
Yeah, I, I mean, you hit it on the head. I mean, the most important thing is the budgeting part, you know, before the year starts. Right. If you just go into the year, you don’t have a, you don’t have a, a defined budget. You may or may not have a plan. You can’t, and then you can’t measure against it. You’re kind of at the whim of, you know, whatever happens. And I think when we talk about the budgeting process, I like to, for me, the most important thing is to build a budget from the ground up, not, not from the top down.
Jason Krueger [00:06:58]:
And what I mean by that is, let’s say a firm company’s doing $10 million in revenue. What I don’t recommend is saying, well, you know, I think we’re going to do 10% more this year, and all of a sudden now we’re going to do $11 million. How did you get there? How did you, how do you know you’re going to do 11 million? And if the answer is, well, we’ve done 10% every year, or we’ve done 20% every year, so we’re Going to do it again next year. In the services firm in particular, it gets harder and harder to have that maintain that percentage level of growth because you have to have the infrastructure, you know, from a business development and marketing perspective to be able to achieve that. If you do nothing else, the same, you’re probably going to have, you may have the same dollar growth, but you won’t have the same percentage growth. And at the same time, in professional services, you have to consider, you know, potential attrition of clients. There’s going to be a natural churn of clients, right? Even if you’re servicing them. Clients the best in the world, if you’re on a recurring basis, if you have a recurring client base, you could be a great service provider.
Jason Krueger [00:07:59]:
But maybe they exit, maybe they sell, maybe they hire internally, you know, whatever they decide to do. If you’re project based, that becomes even more challenging. So it’s important one to build it from the ground up. And when you, when we do that, we want to look at, you know, business development and marketing separately, but also collaboratively. So you may have a business development or a sales team and then you have a marketing arm. And what it really comes down to for both is the activities and the plan that will allow us to achieve the results we have. So historical performance is a barometer of what we’ve, you know, what we’ve been able to accomplish. If we’re looking specifically into the marketing function, what are the campaigns, what has been our strategy historically? How can we continue to tweak that and improve that over time? Can we measure direct results from our marketing strategy? You know, I think finance always likes to say, well, we did this, what did we get out of it? And marketing a lot of times says, well, part of it is branding, part of it is a process of building up that awareness over a period of time.
Jason Krueger [00:09:06]:
And, you know, finance doesn’t like to hear that. They like to see a direct correlation, right? So it’s making sure that you are actually aligned with, here’s our marketing strategy. Here’s what we did last year. Was it or is it working? And should we continue with the same strategy moving forward from that? What do we expect the results to be on a weekly, monthly, annual basis? And there’s obviously, you know, you know, Katie more than I would, but there’s triggering events as far as the level of interaction, the level of awareness that the market sees, or the interaction that the outside market may be interacting with you on your website or with your different campaigns or what you might be doing. That’s one triggering event. But ultimately what finance like to see is was there a closed deal? Right? So ultimately, how do you correlate those to a closed deal? Get alignment on what we expect. And when we look at marketing, you know, with my previous firm too and with our clients, there’s branding like we talked about, you have social media media, you might have sponsorships, you might do things like webinars or speaking engagements, you might go to events or trade shows. So depending on, you know, what you’re doing, I like to break out, what do we think our results will be from each of these different verticals? And then overall, what do we expect it to be from an overall perspective? And then how do we measure that? And that’s what it ultimately comes down to is do we have a strategy, are we aligned on how we measure it, what success equals? And then over a period of time each month we’re looking at, okay, if our goal is X per year, are we, are we tracking towards that goal, are we not? And you know, and let’s tweak it along the way based on what we see happening.
Katie [00:10:53]:
I think that’s really sage advice and you know, part of your budgeting from the ground up and being really thoughtful and honest with yourself. And you know, we’re an aec, we love to talk about our high repeat client percentage and that’s great. But you’re right, you know, year over year you’re going to have some percentage of attrition and maybe you, maybe you retain the client. But hey, they’re only going to do a new headquarters building at that dollar volume once every what, 20, 30 years. So you can’t count on, you’re going to backfill that same amount of volume with that client. So it’s got to come from somewhere else. So I know when we’re talking with a lot of clients and we’re looking at their growth strategy and how they’re going to get to their financial success, whether it’s revenue goals or whatever that looks like. You know, the easiest thing to sell is to sell into existing clients, right? Wallet expansion.
Katie [00:11:44]:
They’ve already hired you, they’ve trusted you. In most cases you’ve already got a regular cadence with them in which to have business development conversations. Whether you’re adding scope of services to current projects or you’re getting exposure from one division to another or different office or however those organizations are structured, that seems to be, you know, low hanging fruit, easy things to think about. But then you have to also account for the fact that you’re going to need to acquire new clients. And both of those scenarios require different levels of effort. So you could say, hey, it’s easier to sell into current clients, but maybe that burden is on your higher billable staff who’s actively engaging. And so that client acquisition cost looks like X versus new clients. We’re going to rely on the marketing team and digital programming, you know, brand reputation to drive demand to get interest for us.
Katie [00:12:42]:
And so that client acquisition cost looks like this. So maybe talk a little bit about maybe from a financial perspective, what should firms be tracking as it relates to that client acquisition cost either for growing existing client accounts, maybe growing new business and then how to account for that deal velocity that you mentioned. You know, at the end of the day we want to know this, plus this equaled this job. And now we’re building time again, you.
Jason Krueger [00:13:11]:
Know, a lot, a lot of it as you kind of alluded to. I mean there’s obviously the client acquisition cost really comes down to ultimately how do we determine how much we can invest? A lot of that comes down to the value of the client. Right. So if it’s a recurring client or recurring relationship that we know is going to have recurring opportunities on a long term basis, we’re willing to spend more or invest more to get that client because we know it’s going to have a long tail versus a one off project that you’re likely never going to have another engagement with that client ever again. We don’t want to be taking up a lot of resources and things to, to close that deal. So that’s something also to consider is from a strategic perspective is how do I value my clients, the type of work I do and to ultimately to drive more towards higher value longer term clients. Right. I mean, I think another thing we’ll talk about is potentially an exit or you know, moving on from your business at some point.
Jason Krueger [00:14:19]:
I always like to look at a business from if I was to exit, am I maximizing the overall value of my business and entity? And that comes down to a client by client basis, recurring versus project. You know, there’s different levels of value there. And so that then comes back to how you look at client acquisition cost. Again without getting into too much specifics, it really comes down to breaking it down by type of service line and then based on or service line or project or you know, how are you, your different revenue streams and then making sure that you have a strategy for each of those or incentives for the team to drive towards higher value clients. Right. So from our firm and My previous firm, the sales and business development and marketing for that matter, were more incentivized to drive clients that we knew would be recurring in nature. And so you could do that through a number of different ways. Obviously commissions and compensation is the biggest driver, but how you measure that success is also important.
Jason Krueger [00:15:24]:
So you know, we really celebrated wins where it was a recurring client, if it was a project, great. Those kind of the ones that keep the lights on. But the real value in the business is creating that longer term client relationship. So how do we position our strategy and incentivize our team to drive that and then how do we measure, to your point, what does it take, you know, based on the strategies and how we approach it? What is the cost for each of those strategies so we can measure against it?
Katie [00:15:53]:
Yeah, I like that. And kind of on that, that topic, you know, this idea of budgeting, this idea of taking into account those different scenarios, one of the other things that I think a lot of our listeners are being faced with is just keeping up with the rapid pace of change that we’re all experiencing. And I think a lot of our clients going through that budgeting process and they’re seeing new line items come across these budget requests, things that they’ve never really accounted for, whether it’s AI tools and technology tools, automations, but then it might be different talent developments where they’re reskilling their teams that were more focused on this. But now they need to go over here because the industry’s changed a little bit as we’re looking at this season of budgeting. I don’t think it’s so much understanding what you’re spending, surely that’s part of it, but it’s also where you’re spending it and what you’re spending it on because those line items just look different. So from your perspective, what are some things that our listeners can do to help align their budgeting with smarter decision makers on these line items where there’s no historical data, you know, they don’t really know what they’re going to get out of it. Point to X amount of return, what’s some advice around that? So they’re not just making a, let me check the wind and see if I can fund this today.
Jason Krueger [00:17:23]:
When I like to talk, when I like to talk to business owners, you know, I think it’s what’s critical as a business owner is to understand all aspects of your business. Right. A lot of business owners, they start, you know, in, in the aec. So you’re an architect or you’re an engineer and you’re a good architect, and you decide to start your own firm. And you know architecture, you know engineering, you know your trade, but you haven’t had a lot of exposure to sales, marketing, finance, hr, et cetera. And so what I always like to say is, you want to hire the right people with the right expertise, but you still have to understand what they’re doing and you still have to manage those individuals. Right? And so coming back to your question, it’s not simply telling marketing, you know, just let me know what you’re going to do and give me a budget. It’s really interacting and having those conversations with the team about, okay, again, what’s our current strategy? What was our strategy going into last year? What was our overall spend and cost? Not just on the indirect marketing cost, but also on people, personnel, what’s our investment? How does that tie into business development, sales, and our investment there? And leveraging the expert, you know, that you have internally or externally, like yourself, Katie, talking about, what is our strategy next year and what are the tools? How are things changing in the marketplace? We always hear the term AI.
Jason Krueger [00:18:49]:
What does that mean? So I think the first step is education and leveraging. Someone like yourself, Katie, who’s been out there, knows, sees the market, knows what’s coming up. I don’t recommend going all in, you know, on day one and saying, yeah, we’re going to invest in everything, right, without understanding really what it is and what it means. But I think it’s important as a business owner to leverage the experts to get their thoughts and in collaboration with the expert, build out a plan that you feel makes sense based on your understanding of your business, what you’re trying to accomplish, how you define success, and the new tools or approaches that might be out there. Some of it is, you know, we don’t really know what the outcome might be, but based on our experience, we think this might be a good approach. And, okay, great, let’s add that to our plan. Let’s measure the results, let’s see what happens. That’s probably the biggest thing for me is instead of just putting a blind eye to all of marketing and say, just let them do what they do.
Jason Krueger [00:19:50]:
As a business owner, it’s collaboration, it’s being a part of it. It’s building the plan together, helping understand from the expert. But ultimately you’re the one that’s responsible. So if things don’t go right, you can’t be pointing to the marketing team and saying, well, you didn’t do a good job. If you’re not part of the process, that’s on you as a business owner as well.
Katie [00:20:10]:
Yeah, it’s a team sport, Right. This whole idea of professional service marketing is a team sport. I’d like to maybe get your perspective, your financial lens on the flip side. So, sure, marketing is going to ask for, right? They’re always going to feel like they’re underfunded, they’re understaffed. But at the same time, what’s the best way to illustrate the cost of inaction on trying new things, you know, investing in a new website, hiring that PR agent, whatever it might be to executive leadership, you know, to try these new things. How do you convey the cost of inaction?
Jason Krueger [00:20:45]:
Yeah, I think a lot of it comes down to what are the goals of management, right. Are they happy where they’re at? Are they looking to grow slowly or they want rapid growth and success? If they’re happy where they’re at, maybe they don’t see value in marketing. Maybe they understand kind of they bring in X number of clients every year and every year they lose X number of clients. We like to, and I know you like to, Katie, work with companies that are looking to grow and looking to scale and looking to perform right, because they see more of that value, they’re willing to invest in that. Again, it’s the mindset of the firm, the business owners is, is critical. It also then comes down to, you know, the budgeting process. And so that’s where, you know, I think you budget and then forecast out. And we want to look at, you know, different scenarios.
Jason Krueger [00:21:29]:
We also want to understand from the expert like yourself, if we’re, if we are, if we have a certain campaign, what can we expect our results to be? Is this going to be something that will pay off immediately or is this something that might take a number of months, might take six months, might take a year to even start to see the results? Right. So there has to be alignment in those expectations to be able to make that investment. If there’s not alignment and you’re thinking, hey, this is going to be a one year strategy that we won’t see results for another year or 18 months, and management thinks that they should see results in month two, then you’re misaligned and then there’s going to be the stop and start and you’re not going to get, you know, that consistency that we talked about before. So I think the biggest part as far as, you know, the investment is what’s the mindset of the company? Are they looking to Grow? Are they happy where they’re at? If they are looking to grow, leverage the expert like yourself to say, okay, what are some strategies we can put in place that might give us some quick wins and also some longer term strategies that will help build us up over a period of time. Make sure that we identify those. How do we measure success? Even though we might not be bringing in revenue or wins, we still want to be able to. If it’s a longer term strategy, we still want to be able to measure some level of success that we agree on. And sometimes, you know, someone in marketing might say, well, look at all these clicks.
Jason Krueger [00:22:49]:
That’s success. And someone in management might say, well, I don’t care about the clicks. Who were they or did a return into revenue, Right. It’s like, well, if they were all these clicks from some other country that has, that is never going to buy my product or my service, I don’t care, you know, and so aligning that is critical as well.
Katie [00:23:07]:
Yeah. And I think that that’s really, really great advice. You know, sometimes marketers, we get a little nerdy with what I call our vanity metrics. Like, it’s great. You’re getting fantastic, you know, numbers of visitors to your website. Thumbs up, keep doing that. You know, people are opening your emails, great people are engaging with your social posts, people are coming to your online events. All fantastic things.
Katie [00:23:31]:
And I want all the marketers feel really good about it. But to make it tangible for the technical team, the operations team, is to provide that lens of transparency on who they are and why it matters that they came. Hey, we had 300 people attend our webinar. 18 people were from this key account. Here’s who they were. I think this would be really good to share with our project manager that oversees that account so that he can see, you know, maybe there’s something we can offer them as a follow up because clearly they were interested in xyz. Like the who is super, super important. And the more that we can provide level of transparency to our operations team, then they see the value in all this.
Katie [00:24:12]:
Like, you know, kind of smoke and mirrors what marketing is doing. Right?
Jason Krueger [00:24:16]:
Yeah.
Katie [00:24:16]:
As marketers, we’re educated in the, in the art of marketing. We get excited about it. Our internal clients aren’t always the same and certainly if we’re advocating for additional dollars. So Jason, I want to go back to this topic of growth and scalable growth because you mentioned, you know, you and I both work for firms that are looking to grow and scale their business. But that’s Kind of a catch all term. So let’s nail down, you know, when a firm says they want to scale, when they want to grow, from a financial health standpoint, what should they really be thinking about? You know, what should they be protecting, what should they be investing in, what should they be planning for?
Jason Krueger [00:24:53]:
Yeah, from a financial side, it really comes down to cash flow. So I’ve seen, you know, companies, firms that they want to grow and they may even be profitable by the, you know, when they look at the income statement, but they’re not able to maintain what they’re doing because they don’t have the cash to do it. And what I mean by that is if you’re a service based firm, like an engineering or an architectural firm, you pay in your employees every two weeks. Let’s say, well, if you’re growing, you’re still paying your employees, you’re paying more employees because you’re growing, you’re hiring more people, but you’re performing the work one month, then you send an invoice to next month and then they might not pay you for 30, 60, 90 days. And so your cash gets stretched. So the first thing is, you know, obviously if you want to grow, I think understanding the flow of cash in your organization is critical. That then allows you to make decisions to manage the cash and manage your growth. You might need to make a decision to, hey, you know what, we understand it’s going to take some investment up front, so we might need to build a relationship with a bank and get a line of credit to support that or some sort of financing to support that.
Jason Krueger [00:26:03]:
So that’s probably the most critical thing from a scaling and a financial perspective, from a health of a business perspective. And to truly scale a business, it’s really all about building that infrastructure so that you as the business owner, everything doesn’t rely on you. And then ultimately if you are looking to scale and potentially exit or sell your, your business, then it even becomes more important because the buyer wants to buy a business, they don’t want to buy everything that relies on you. And when you leave and walk out the door, the company falls apart. Right? So building that extra layer of that management structure, removing yourself as a business owner from all of your client responsibilities even and really providing that leadership in those kind of made four or five areas I talked about before, which is obviously operations, finance, sales, marketing, hr, those are critical. Building that management level structure below you to support that. And so that as a company scales allows you to, what we hear all the time, which is you should be Working on your business, not in your business. Right.
Jason Krueger [00:27:09]:
And that is when you’re working in your business, you’re not able to effectively scale and grow the business effectively as well. So those are probably the key things, I think when we talk about just from a business perspective and from a finance perspective, it’s managing cash flow and then having good, consistent financial information and metrics that you’re measuring against on a monthly basis at a minimum. Which means you understand the profitability of your jobs, profitability on a client by client basis. You understand the success of. We talked about sales, marketing, how you measure success in those areas. You understand where all of your other expenses are to ensure that they’re maximizing value to the business as a whole and obviously your people and your team as well.
Katie [00:27:56]:
One of the big vehicles that I’m seeing that are allowing these firms to grow and scale is through M and A transactions. You know, I see that a lot in design and construction. So I want to maybe take a moment and talk a little bit about from your seat, what you’re seeing behind the curtain or what types of reports or behaviors that really separate the firms who are ready to sell versus those that still have work to do in terms of getting their financial house in check. Right. So what does good reporting look like, Jason? If a firm’s preparing for an M and A transaction.
Jason Krueger [00:28:34]:
Yeah. So if they’re looking to sell, the first question that anybody is going to ask you is, let me see your financials. Right?
Katie [00:28:42]:
Yeah.
Jason Krueger [00:28:43]:
And if you don’t have an understanding of the financials, if you can’t speak to the financials, if you can’t tell the story of the financials, want to might be challenging to sell. And the second is you’re not going to get the price that you think you might deserve from that. So it’s critical to have good financial structure in place. The second is, you know, they’re going to say, let me see your financials. But it’s all about. In a sale process, it’s all about showing you have sophistication, professionalism and credibility. And so if we’re just sending. If we’re just hitting print on QuickBooks or accounting system and sending them over, one, we don’t look as credible because we’re just sending them, you know, financials and it’s just printed out from the system, we don’t look credible.
Jason Krueger [00:29:25]:
And we’re also allowing that individual, whoever’s sending it to, to create their own story about your business based on the financials. And when we are talking to A third party. What we want to be able to do is provide good financials that tell our story, that show, you know, what a buyer might be looking at, which are the trends of your business over the last three years, the growth of your business and understanding of what the margins are of the services that you perform, being proactive and truly understanding what a buyer might be looking at to carve out some of the things that maybe don’t look as good and identify them as maybe one offs. Right. Like maybe you’re, maybe you had a couple bad projects that historically you’re not going to have again that are weighing down your margin. Let’s carve those out so they can see, hey, if you buy us, this is a real margin you’re getting. These are one offs, we’re done with that. That’s not happening again.
Jason Krueger [00:30:20]:
And so we just now automatically created a lot more value for our firm just because we carved out a couple of bad projects that we’ve learned from and aren’t going to make the same mistake again. And so that is critical in maximizing the value of what you’re going to sell for versus saying, here’s my financials, tell me what you’ll pay for it. You want to go in with, here’s my financials, here’s the story, and here’s what you should be paying for it.
Katie [00:30:50]:
Yeah. And I think that, I think that’s really a great bridge for where marketing and communications can help support in that storytelling. Because you’re right, the, the financials are going to tell you the facts. Right. I mean, math doesn’t lie, but it also doesn’t tell a story. So there might be a way where marketing and business development can help paint the story around the type of clientele that you serve and their credit worthiness and the appetite for continuing to buy your services. You might be able to paint the picture of where the firm started and where it grew and how it got there. Was it through a key account that expanded and now you’re really rolling with it, or is it through these marketing campaigns and you have a more diversified portfolio or client list? But I do think that there’s a great opportunity for marketing to add value to financial reporting, even though it’s not usually considered a asset that’s being purchased, Right?
Jason Krueger [00:31:46]:
Absolutely. I mean, that, you know, that could be a huge generator of the growth that the firm has had. And, you know, when they’re acquiring the firm, they want to understand what are, what is your secret sauce? What are you doing from a marketing and sales Perspective, and can you maintain this level of growth through that? So they want, hey, yeah, I really believe in what they’re doing here. It’s showing results. So now maybe we can add investment or fuel to the fire on this and really ramp it up even more to drive even greater results. That’s what if you have a good process. I mean, when we were acquired by Citroen Cooperman, we had a full sales playbook and we had a full marketing strategy that we were able to communicate. Hey, this is how we’ve gotten to where we are, and this is how we’re continuing to grow and get to where we want to be.
Jason Krueger [00:32:36]:
And there’s a lot of value in that from a buyer’s perspective.
Katie [00:32:39]:
Yeah. And I think it points back to those three things. Right. Like, you’re professional, you’re credible. Like, all of that kind of comes back. Jason, this has been great. As we wrap up today’s conversation. I love for you to share your wisdom.
Katie [00:32:54]:
What is one thing you would encourage AEC principals, studio leaders to rethink when it comes to their financial planning for their firms?
Jason Krueger [00:33:06]:
Yeah, I would say one is know your financials, have a good process in place to produce timely, accurate, relevant financials every single month, at a minimum, where you can really break it down and truly understand your business and what’s driving success in your business. If you have clarity on the margins of your business, that will then allow you to determine what your investments are in things like sales, marketing, and other aspects of your firm. And so under having a good process to close your books, develop good financial reporting, be in a position that if somebody comes tomorrow and says, hey, I want to buy your business, you can. You’re not scrambling to pull something together. Your business, you can provide them information immediately gives you the credibility. And that buyer knows, hey, I’m gonna have to pay top dollar. Because this firm has everything in order. They know what they’re doing.
Jason Krueger [00:34:05]:
You want to separate yourself. And the biggest way to separate yourself from most other firms is to have that structure in place from a financial perspective so you could speak to your business along with the other areas. Hey, do you have an operational playbook on how you service your clients? Do you have a playbook on sales? You know, we’re all about playbooks. We have a sales playbook. We have a marketing strategy plan playbook. We have a client service playbook. All of that sets you apart. And so they know, hey, this firm is not just flying by the seat of their pants.
Jason Krueger [00:34:39]:
They have structure. You know, it’s not Reliant on one person. They have a management structure, they have a qa, QC structure behind the scenes to ensure that the clients are being serviced effectively and at the highest level of quality. And everybody knows they can point to. This is how we service our clients. This is how we go to market. This is how we support our employees and our team through our HR and resources we have for our team. All of that creates value, tremendous value above another firm who might have the same revenue and the same profitability.
Jason Krueger [00:35:12]:
They’re going to pay more for you than they would that other firm.
Katie [00:35:15]:
Well, and I think all those playbooks also enable the leaders to become irrelevant.
Jason Krueger [00:35:20]:
Right.
Katie [00:35:20]:
So they don’t have to continue in the business they can work on and elevate. I know that’s something that I’ve observed. Okay, one final question for you. When you’re consulting and you’re working with these professional service firms for the first time, what is one metric that they’re often not paying attention to but that they should be, that they can have a little bit stronger financial literacy, your.
Jason Krueger [00:35:45]:
Margin, and understand how you measure that. What I mean by that is when you do a job, how profitable are you on that job? But then also it comes down to how your team, if you have full time employees, are they utilized? And utilization rates of your team. So in other words, one person might work on a job and that job on the time they’re incurring on that job may be very profitable. But if they’re only working, if they’re only spending 10 hours a week working on a client and you’re paying them for 40, you know, you’re losing money overall because that person’s not utilized. So being able to balance out, you know, the profitability on a, on a job and your team’s utilization are the two critical components to a professional service based firm. Whether you’re tracking time or not, it’s being able to measure or you have you’re billing by the hour or you’re billing on a job by job basis or fixed fee basis, you still have to be able to track that to be able to, you know, ultimately maximize that profitability within your business. And that’s probably the biggest thing on professional service side of things as it relates to the financial side of the business.
Katie [00:36:55]:
That is great. And this has been really helpful. Thank you for talking with me about money. I feel like it’s only suiting, you know, Katie Cash gets to talk about money. If our listeners want to connect with you and learn more about what you and your firm do. What is the best way to reach them? Where can you send them? Give a little bit of insight there.
Jason Krueger [00:37:16]:
Yeah, absolutely. You know, LinkedIn’s always an easy way. Jason Krueger I’m at Citroen Cooperman, so pretty easy to find. I can also, if you want to reach out via email, the letter J Kruger. That’s K r u g e [email protected] Citrin is with a C C I T r I n cooperman.com always happy to talk to, you know any business owner. If I know the answer, great. If I don’t, I typically know somebody I can refer you to that might have the right answer. And if it’s about marketing and strategy around that, I’ll just send you back to Katie.
Katie [00:37:49]:
Thanks for that. You know, it’s all about who you know, right? Right Is your network. Thank you listeners. And Jason, thank you so much for your insight today. I know this is really, really helpful and very timely given the time of year that it is. So to everyone out there for listening, stay until the end and keep up with your smart marketing. We’ll see you next time. AEC Marketing for Principles is presented by smartigies, the AEC growth consulting firm that has been developing smart business strategies for design and construction firms since 2008.
Katie [00:38:20]:
The show is hosted by me, Katie Cash, Senior VP at Smartigees. I would love to hear from you. If you have a question, a guest request or a topic request for a future episode, send an email or a voice memo to podcastmartigies.com and if you’re looking for past episodes, be sure to visit our podcast [email protected] podcast we hope you’ll tell your friends and colleagues about our show and be sure to subscribe so you don’t miss out on future episodes. Thanks for listening.