There’s a 14-year-old who started his first business with a buddy mowing lawns in Farmington, Missouri. His second business was servicing coffee and cappuccino machines after graduating from college. He and his wife traded the coffee business for chicken which ultimately resulted in a business with a 20-year run of double-digit sales growth.
His name is Shawn Burcham, and he is the founder and CEO of employee-owned PFSbrands. CFO Bookshelf took their podcast gig to the road to visit with Shawn and board members of the company where the underlying theme was Open Book Management and Leadership.
Keeping Score With Gritt by Shawn Burcham
- Goal setting is critical – most people do not set goals. Those who do typically do not write them do.
- Hold self and others accountable.
- The family behind the founder.
- A focus on employees.
- Business transparency.
- Development of team members
What is a Financial Huddle?
- Gathering staff together to go over numbers – financial and non-financial.
- All about getting people talking about data and looking at trends, and then taking action.
- Jen (one of the board members) attends via Zoom each month and notices the positive energy and enthusiasm at all the meetings.
What Were the First Huddles Like at PFSbrands?
- Per Shawn, not as refined as they are today (Mark still enjoyed and appreciated them).
- Everyone was assigned responsibility to at least one or more general ledger accounts – way too much for the controller to manage.
- In those early days, the financials were clearly explained and how each person’s results impacted performance.
- Shawn confesses he was anti-meeting by nature, but saw the communication improve as the business scaled because of these meetings.
- Adding a profit distribution is the icing on the cake.
Does Open Book Management Make a Difference?
- Look at the correlation to sports – employees are more engaged in the game when everyone knows the score and what the numbers mean.
- Trust levels are much higher.
What are a Few of the Key Numbers You Monitor?
- Number of branded accounts – sold, signed, and opened.
- Look at 13 KPIs every Monday morning.
- Still a strong focus on the top line, gross margin, and EBT margin.
- Used to be overly-focused on the top line, but started focusing on expenses too once the open book journey started.
- Good culture doesn’t happen by accident.
- In a small group, a good culture is easier to maintain. As the business scales, it’s harder, especially when you add in a remote workforce.
- Not the result of reading a book.
- It’s a way of living.
- Every company has a culture. It’s either accidental or intentional.
- Core values are a verb at PFSbrands.
- Core values are not shallow words printed on a poster hung throughout the hallways.
- Trevor (the CFO) uses core values in the mentoring, coaching, and development of staff.
Management and Leadership Teams
- Small businesses need a formalized management team comprised as visionaries and integrators.
- Shawn recommends Topgrading for being more intentional in selecting team members.
- Trevor explains the difference between a management team and a leadership. Once focuses on getting the work done. The other is about inspiring others. Both are critical.
What are Discovery Days?
- Hosted once per month for customers that come to visit the company.
- They are amazed when they see the culture, the numbers, and the overall positive vibe of the company.
- Per Shawn, if you have a great company, get customers to your business and let them experience what you’ve created.
Other Key Assets of PFSbrands
- Focus and fanaticism on customer service.
- Data – culling, cleansing, analyzing, and turning it into meaningful information.
- Fostering an entrepreneurial mindset.
What is an ESOP?
- Still generally unknown or misunderstood.
- Trevor gives the 101 on ESOPs
- The ‘why’ behind the move to an ESOP at PFSbrands.
Do not hesitate to reach out to Shawn, Trevor, or Jen on LinkedIn. Here is where you can find them –
Also mentioned on the show was Gritt Business Coaching, the coaching and consulting arm of PFSbrands whose focus is on Open Book Management implementations for small to mid-sized businesses around the country. I would even bet my life savings that this firm will be serving clients internationally very soon.