Speaker: 0:01

Welcome to The Heart-Led Business Show, where compassion meets commerce and leaders lead with love. Join your host, Tom Jackobs, as he delves into the insightful conversations with visionary business leaders who defy the status quo, putting humanity first and profit second. From heartfelt strategies to inspiring stories, this podcast is your compass in the world of conscious capitalism. So buckle up and let your heart guide your business journey.

Tom Jackobs: 0:36

Well, welcome back to the heart-led business show. We are about to surf the sweet waves of entrepreneurship with our guest today, Michael Barbarita. This visionary has been steering the ship of retail and manufacturing for four decades from growing ski town USA to a whopping$8 million in turnover. I mean, that's some serious slope of success. Plus he's even concocted those delightful cookies to scoop, which made a splash on QVC. And let's not forget about the cookie loving kudos he received in the Bay State back in 1997. So get ready to dive into the heart of business brilliance. Michael, welcome to the show.

Michael Barbarita: 1:18

Thank you very much, Tom. Thanks for having me. Appreciate it.

Tom Jackobs: 1:21

I am super excited for this conversation today because we don't often have somebody with manufacturing and retail experience on the show, and I think that's gonna be important to have that discussion as well. But of course, the first question I always like to ask is, what's your definition of a heart-led business?

Michael Barbarita: 1:40

Great question. For me it's number one, getting the mission clear, meaning and the vision. And what do I mean by that? The way I define that is what is the world gonna look like when you're done? So what is the world gonna look like when I'm done? So that's how I see I set the tone, and then with that vision and mission comes the passion. That nothing is gonna stop you from accomplishing that. And that's where the heart-led component really comes in. And it's, on a 1 to 10 scale, with one being, it would be nice if this would happen and up to 10 where nothing is gonna stop me from achieving this. You have to be at that 10 because if you're not at that 10, you're gonna get the heart is gonna get weak, so to speak. And it's just that because there's just so many pitfalls and road roadblocks in your journey that if the heart isn't in it, um, the, it's just you're gonna quit. You're gonna quit. That's my definition. It starts with the vision and mission and it's, it really starts with the question, what is the world gonna look like when you're done?

Tom Jackobs: 2:56

Yeah. I love that.

Michael Barbarita: 2:58

Yeah, that's really where it starts. And then, once you've determine that clearly enough now you determine whether your heart is in that vision mission. then once it is, then on a scale of one to then you ask yourself on a scale of 1 to 10, one being it would be nice and 10 being nothing's gonna stop me, then that's a heart to me, that's a heart-led business.

Tom Jackobs: 3:25

I love that. I would guess that if we pulled a hundred entrepreneurs in their business that there would probably be 10%, maybe that are tens and the rest are gonna be nine and below. What do you think?

Michael Barbarita: 3:43

I think that's true, but I think it's the way you frame the question. I ask that in all of the people that I bring, that I work with. That's one of the first questions that I ask on a scale of 1 to 10, how driven are you to do this? How important is it to achieve that vision and mission? And I say it just like I said it to you one being, it would be okay, 10 being I, nothing's gonna stop me. And that, and that's when they finally understand it. Because if I just say on a scale of 1 to 10 where do you stand? I'll hear the sevens and eights, and then I'll say, you're only 70% committed. If they say a seven, I said there's only 70% committed. And that's, oh no. So it depends how you frame it. Yes. That's a C, right? C minus.

Tom Jackobs: 4:33

C minus, right? Yeah.

Michael Barbarita: 4:36

Yeah, so it, you have to frame it right for them to answer it correctly. All right. Because otherwise they're gonna just think that, nothing is because to some people nothing is a 10.

Tom Jackobs: 4:49

Yeah. And for some people they have 12.

Michael Barbarita: 4:53

That's right. That's right too. Yeah. I get that as well. Absolutely. Yeah.

Tom Jackobs: 4:58

Yeah. And I think, and I've had guests on here before that, were part of kind of profit led businesses at first and then moved into their own heart-led business. And they said that when they were working in profit, and people were just thinking about profit, and then there was a bump in the road. It's just easy to bail because then it's just your heart's not in it. It's, you're just looking for the money. And that's sad. I don't, I dunno, like to work like that.

Michael Barbarita: 5:23

Yeah it is, I think it happens to a lot of us because, sometimes we go in first with the money. What I found is that if you go in with the mission and the vision and you're committed to it, all of that happens by itself. rest of it happens by itself. The money, the opportunity, the comradery with a team. All of that happens by osmosis automatically. It just happens. Because of your desire. That's how I see it. That's how, and that's how I've seen it. I started out Profit Motive. I started out that way. Yeah.

Tom Jackobs: 5:58

Tell us about business journey.

Michael Barbarita: 6:01

Okay. So back in 1999 I sold my second business successfully. My first business sold for multiple seven figures, and at that point, I just felt I could do no wrong. And having yeah, and having sold two business successfully, I I thought I had the keys to the business kingdom, to be honest with you, and I could succeed at anything. So in all of my glory, I started an outpatient rehabilitation facility called Freedom Therapy Center. So in addition to manufacturing, I was also involved in service. And what I found is that in the successful businesses I owned, because I fell on my face in the outpatient rehabilitation facility. What I found is that in the successful businesses I owned, I always implemented, business and financial strategies that my competition wasn't doing. And for some reason, and I don't know the reason, and it took the failure to be able for me to analyze this, but for whatever reason, I did everything that my competition was doing in the outpatient rehabilitation facility. I copied them. I did everything that they were doing. I didn't do anything. Just to give you an example, when I was in the ski business, one of the problems that the customer had was that they didn't know if the ski, they were being sold by some hot shot ski salesperson that would flex the ski in their face was the right ski for them until they got it up on the mountain and tried it out. So what we did is we implemented what we call the ski guarantee. Ski the ski three times, you don't like it, bring it back for a brand new pair and keep bringing it back until we get it right now, as you probably know, and as your audience probably knows, if you ski on a ski, it depreciates substantially. So my managers and employees thought I was nuts because it was so contrary to what was happening. I knew two things. Number one, I knew my competition wouldn't do it in a million years. And two, the second thing I knew is that all the customer really wanted was a great ski experience because there's nothing worse in the world that to spend all the money and all the time to go to the mountain and then have a terrible experience'cause my skis aren't working properly, or my skis don't feel right to me. So there's nothing worse in the world. So that's all the customer really wanted was a great ski experience. The first year we implemented, we sold 8,000 pair of skis, a 25% increase, and only eight came back. And my employees right? My employees thought thousands of pair of skis were gonna come back and then we're gonna lose a ton of money.

Tom Jackobs: 8:46

Of course they did.

Michael Barbarita: 8:47

Right? You know this, so this is where, where your

Tom Jackobs: 8:50

the way your mission and vision comes in.

Michael Barbarita: 8:52

And you have to really fight off even your team members at times. Okay? Because, yeah. And that was a great example of that. Uh, another thing that we did in the ski business is everybody and his brother had ski packages, skis, bindings, poles. Even skis bindings, poles and boots. Everybody. Everybody. Every competitor, everyone. But what we did is we took the most popular ski graphics, okay. The skis that sold the most and the coloration that was on there. And we went to the clothing department and we put together matching, parker, pant, hat, and sweater, and packaged it up. And we sold a ton of'em. After we sold the skis, we just brought'em over to the clothing department and showed them the matching package. Clothing package.

Tom Jackobs: 9:47

Talk about contrarian. So what's coming to mind right now is you are listening to your customer and doing things differently than your competitors, which to me is brilliant. Because if you do the same thing that everybody else is doing, you become a commodity and then it's a race to the floor versus being unique and different. There is no downside. There's only upside.

Michael Barbarita: 10:10

Absolutely. And

Tom Jackobs: 10:12

In the rehab business, did you listen to your customers?

Michael Barbarita: 10:16

No,

Tom Jackobs: 10:18

Okay. You didn't listen to your customers.

Michael Barbarita: 10:20

No. I just followed, I followed the crowd. In other words, I call it. I hope so marketing. Let, lemme explain that concept Tom, when somebody says great service, highest quality, been in business for 2000 years great location. We're honest and sincere. All of that. The customer is saying to themselves, I hope so. I hope you have high quality. I hope you have great experience. Why would I do something with business with somebody who doesn't have high quality and great experience? And why would I do business with someone who isn't honest and sincere?

Tom Jackobs: 10:56

Right.

Michael Barbarita: 10:56

And by the way, Al Capone thought he was honest and sincere, so I,

Tom Jackobs: 11:02

That's

Michael Barbarita: 11:03

I call it, I hope so, marketing, because if you look at your website and your competitor's website, I bet you they're saying very similar things.

Tom Jackobs: 11:12

mm-hmm.

Michael Barbarita: 11:12

So you have to break that mold.

Tom Jackobs: 11:16

Yep.

Michael Barbarita: 11:16

What I was doing when I was in the rehab businesses, I was just copying my competitors and I was doing the all I hope so. We have great service. We have the best physical therapists. We're honest. We're, we are fair with the reimbursement, all of that, all of it doesn't work.

Tom Jackobs: 11:35

Nope. You must have seen my first advertising in my fitness business.'cause that was exactly the same message that I had. Great parking, convenient hours.

Michael Barbarita: 11:46

Yeah. I like the parking thing too. Yeah. Yeah.

Tom Jackobs: 11:49

Like Really?

Michael Barbarita: 11:50

And yeah, and I didn't realize it until I completely fell on my face.

Tom Jackobs: 11:55

Yeah.

Michael Barbarita: 11:56

Then I said, why did I fall on my face? Because I had the keys to the business kingdom. Remember earlier I said that?

Tom Jackobs: 12:02

Yeah.

Michael Barbarita: 12:03

Yeah. And when I analyzed it, it is because I did exactly what my competition was doing, and you can't. And the reason why those packages work so well too is not only because they matched the skis, but packaging and bundling products and services together can separate you from your competition as well, because in all likelihood, they don't have the same package and bundle. And my competitors, even after it worked, by the way, which is weird, but even after at work did not copy me on either the ski guarantee or the packaging of the clothing.

Tom Jackobs: 12:37

That's interesting. There must, they must have been fearful of what your employees were fearful of. A lot of returns.

Michael Barbarita: 12:43

And that's why, and that's how they wrote it off. It's, oh, he's getting hamed on that.

Tom Jackobs: 12:47

Costco does the same thing. They have the free lifetime return guarantee if you're not completely satisfied. And I'm sure some people take advantage of it. Guilty as charged, but.

Michael Barbarita: 12:59

absolutely.

Tom Jackobs: 13:01

But at the end of the day, like it's a great business model because obviously because they're, grown so fast, so quickly and it's clearly not impacting their bottom line that much.

Michael Barbarita: 13:13

Yeah. And what I found, it's part of the five components of a compelling offer, or it's called a risk reversal. When you can

Tom Jackobs: 13:20

Yeah.

Michael Barbarita: 13:20

a risk and when you could do an effective risk reversal, especially if you're solving a problem. At the same time, if you recall, I said the problem the customer had was they didn't the ski they were being sold. They didn't know if it was the right ski for them until they tried it out. But, and the other thing is people don't wanna look foolish Tom and a reversal eliminates that, especially to their spouse or, to their friends. They don't wanna look like a fool. So when they make a purchase, they wanna make sure that it's right for them, and the guarantee ensures that. And so that's why a risk reversal is so compelling and should be part of every business owner's offer.

Tom Jackobs: 14:00

Yeah. Yeah. I for my signature program Selling With Heart, I offer a full money back guarantee if we don't help them double their sales in six months.

Michael Barbarita: 14:09

That's awesome.

Tom Jackobs: 14:11

Okay.

Michael Barbarita: 14:11

Yeah. That, that, that's a phenomenal guarantee. Phenomenal.

Tom Jackobs: 14:15

Yeah, and it's nerve wracking, but again, it puts our feet to the fire in terms of delivering on that service. But also, like you said, making it easy for the prospect to buy because now they're like if it doesn't work out, then I can get my money back.

Michael Barbarita: 14:31

Right, absolutely.

Tom Jackobs: 14:33

And when the business owner gives a guarantee that you're showing really strong confidence in your product and your service. Yeah, And if you have the heart in, in, in the business, then of course that's, you're gonna be successful with that.

Michael Barbarita: 14:48

Absolutely. Because nothing's gonna stop you. Because nothing's gonna stop you.

Tom Jackobs: 14:56

and then I just killed my camera. I must have a loose wire. My desk. You must have a really strong desk if you have to like,

Michael Barbarita: 15:05

yes I do. I got very powerful desk. That's right. We can handle anything.

Tom Jackobs: 15:09

That's awesome. So let's take, let's go back to your businesses and what is, how did you transition then into the heart-led business model?

Michael Barbarita: 15:20

The way I did that is, is in the business I'm in now. Next Step CFO. For the most part money driven, if you will, if that's what you wanna call it. And what I saw when I got into this business, and I got into it 30 days after I closed Freedom Therapy Center. So I got into it right away because the hardest step in life to take is the step after the fall, the Next Step.

Tom Jackobs: 15:43

Yeah.

Michael Barbarita: 15:43

That's why I named my company Next Step CFO.

Tom Jackobs: 15:47

Huh?

Michael Barbarita: 15:47

The hardest because I fell in my face. And the hardest step to take is this next, is the step after the fall, that Next Step. And as, and like I said, as I reflected, I said, maybe just maybe profit motivation isn't all of it. And I, what I saw was overwhelmed business owners. And I was I was coming off of an overwhelming situation, so that's what made me feel like, okay, I was overwhelmed in that situation. I thought I was hot shot city, right? Going into it, I thought I was the, the bees, the knees bees, knees or whatever it's called, right? And then coming out of it, after falling on my face. I'm saying to myself, maybe it's not all about profit. And seeing that I was totally overwhelmed. And then ha having interviewed some small business owners, they seemed very overwhelmed and none of them had time freedom, which is what their expectation was when they started their business. They thought they were gonna have time freedom and consistent profit. As we all know, the journey is, a little wavy on the graph. That's what drove the transition for me. It's my, it was my own experience. When you think about it, it was my own experience. It was me just falling down being overwhelmed and recognizing that overwhelm and time freedom. Needs to be something that business owners have to achieve because that's what their intent was when starting their business in the first place. And so that began the hot lead component.

Tom Jackobs: 17:31

And then within that component of the heart-led what are some of the principles that you stand by then that really solidify that heart-led piece.

Michael Barbarita: 17:40

The way the world is gonna look like for me, uh, when I'm done.

Tom Jackobs: 17:43

Oh, I love that. Yeah.

Michael Barbarita: 17:44

Is that overwhelmed business owners will achieve to ensure that overwhelmed business owners achieve consistent profits. That leads to time freedom to build a legacy and the life they desire. That's really to me, what it, what, that's my heart. That's what's in my heart.

Tom Jackobs: 18:01

Okay.

Michael Barbarita: 18:02

Because that's what I felt when I fell down. I, I, like I said, I was overwhelmed. I was working 80 hours a week. Nothing was working,,right, the employees were leaving, they saw a sinking ship. I was waking up in the middle of the night with cold sweats, worried about cash flow and all the customers I was losing. I want to build a legacy. In my particular case and I wanted to lead the life that I desired. And that's what, and so that's why my, that's my vision, that's my passion, and that's what converted me. My failing converted me is really what happened.

Tom Jackobs: 18:43

Yeah, and I see that quite a bit as well. And that, that's definitely happened to me. Also is when any of the businesses that I've been involved in, if I was just focused on the money side of it, it never went really well. But when I got focused on just serving the client and really just falling in love with the client and understanding what their needs and their desires were, and are then solving those problems, then the money comes. And it usually will come very well. Now on the caveat for that though, is a lot of heart-led business owners feel fear charging what they are worth. What type of advice would you give to those heart-led business owners? Who and I was one at one point. I still am a little bit I think I undercharged a lot of my stuff, but what type of advice would you give them?

Michael Barbarita: 19:39

You have to add, you have to, first of all, you have to believe in your product or service. That's number one, that core belief. The second thing is you have to add more value. You have to continuously add more value and improve, and it's based on what you said earlier. If your if your business is heart-led, you're in constant improvement mode,

Tom Jackobs: 19:57

Yeah.

Michael Barbarita: 19:57

Right? You're in constant improvement mode, so on that basis alone. That you're gonna, you're gonna be able to to, to understand and focus better. Now with respect lemme say this too. Let me give you an example of adding more value, okay?'cause this is a nuts, so thing, when I was in the frozen cookie dough business, okay? The problem the customer had, and as you'll notice I always go there, you have to identify the problem that the customer has.

Tom Jackobs: 20:28

Yeah.

Michael Barbarita: 20:28

The customer had was they didn't wanna, they wanted to sell cookies as an add-on sale. They wanted to do that. Okay. But the problem they had is they didn't wanna waste valuable oven space baking cookies. If you're a pizza parlor, You didn't wanna put cookies in the oven, you wanna put pizza in the oven. Okay? You're a sub shop. You wanted to put warm up subs and put subs in the oven. Okay?

Tom Jackobs: 20:54

Right?

Michael Barbarita: 20:56

There were two things that happened that made me do what I'm about to say. Number one is I really understood the long-term value of a customer and I actually, I believed in my product. I believed in my product, and the second thing is I understood the long-term value of a customer. Because my average opening order was$50, but I gave away a free convection oven with every opening order that cost me$200.

Tom Jackobs: 21:24

Oh my gosh.

Michael Barbarita: 21:25

So I would lose money on every opening order, but I solved the problem that they had and I got in more doors.

Tom Jackobs: 21:31

Yeah.

Michael Barbarita: 21:32

Because of that.

Tom Jackobs: 21:34

Love it.

Michael Barbarita: 21:35

And the long-term value of a customer was five grand.

Tom Jackobs: 21:39

Oh my gosh.

Michael Barbarita: 21:40

Now, if I didn't believe in my product, Okay, then I wouldn't, I would never do that in a million years.'cause I'd be exchanging$50 for 200. The other thing too, Tom, that gets in the way sometimes is business owners hate the numbers and the data, but you have to understand the story of financial state get putting the CFO hat on here.

Tom Jackobs: 22:02

Right.

Michael Barbarita: 22:02

You have to understand the story that the financial statements are telling you. Okay.

Tom Jackobs: 22:07

Yeah.

Michael Barbarita: 22:09

A lot of business owners don't like that at all.

Tom Jackobs: 22:13

That, or they put their head in the sand. I've done that so much, I know the numbers are bad. I don't wanna reconcile my, I don't wanna look at those. I don't wanna see the story.

Michael Barbarita: 22:21

That's the other component of it. And we,'cause we talk about the heartfelt, but we still have to involve the story that the financial statements are telling here that it's not something we can avoid. And a lot of business owners choose to.

Tom Jackobs: 22:35

Yeah, that's unfortunate. But yeah, it's so important. That's one thing that I, when, especially when I do the sales coaching, is knowing those numbers. Because with those numbers. Like you said, they tell a story, but also give you an opportunity to then improve what you need to improve.

Michael Barbarita: 22:53

Absolutely. I'd be out of business if that wasn't the equation. Because I, I'm both a CFO and strategic implementation specialist. So I combine the financial with the strategic. And if I if that wasn't true, that you do have to understand the story, that your financial statements are telling you, then I would be out. At least didn't half of my business.

Tom Jackobs: 23:17

Awesome. While we're on that topic, why don't you tell us a little bit about your business and how people can get ahold of you and potentially work with you.

Michael Barbarita: 23:24

So we are fractional CFOs and strategic implementation specialists. We do, we combine the financial with the strategic so that the business owner can be comfortable that they know that financially, the strategies that we present work, because we show it in like a in a business and casual forecast where they can change the numbers and adjust the forecast any way they want and it's dynamic so that they're able to, see what it looks like if they're 20% off. If they're 20% up, if some expense like insurance, which has been unbelievable with my clients in terms of how it's increased, um, goes up dramatically and what that impact would look like. And then we also give them the strategy. So that they, they have a path on how to get there. So we just don't tell'em, you gotta do 3 million in sales. We show them how to get to 3 million in sales. Okay. And but what I do is I have a book called Powerful Business Strategies that I give away on my website, and you just come to my website and get the book. But I also do book interviews and because I'm always updating the book. Reason is business is always changing and because business is always changing, I wanna make sure the strategies in the book still work in different industries. I interview business owners and essentially the interview goes like this, it's 60 minutes on Zoom. I present strategies from my book, and then I ask if what the impact the strategy would have if a business owner were to implement it in your industry. And then I document it for the book. And that's it. It's 60 minutes. The way to get a book interview is you just go to nextstepcfo.net, hit the contact button, fill out the contact form, and in the message sent section, just put the word book interview and I'll take it from there.

Tom Jackobs: 25:20

Oh that's great. That's wonderful. Yeah. Thanks. Thanks for doing that for the audience. I'm sure they will certainly appreciate that as well. Michael, thank you so much for spending your time with us today and sharing your insights of, four decades of being in business and having some great success and some failures as well.

Michael Barbarita: 25:38

That's right.

Tom Jackobs: 25:39

Love those stories. So that's amazing. So thank you very much for sharing your wisdom with.

Michael Barbarita: 25:43

Really always fun.

Tom Jackobs: 25:45

And thank you listeners for tuning in today because I really appreciate you guys, and I know Michael appreciates you here as well. Make sure that you're checking out everything that he is doing. We're gonna provide all of those links down in the show notes, so it makes it very easy for you to grab all that information. While you're down there in the show notes, there might be a review button and I'd really love it if you could give a, give the show a rating and a review because it just helps spread the word about the heart-led business show and help those that might be struggling a little bit in their business. So, until next time, lead with your heart.

Speaker 2: 26:19

You've been listening to The Heart-Led Business Show, hosted by Tom Jackobs. Join us next time for another inspiring journey into the heart of business.