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Bookkeeper Debbie Roberts built a business that gave her freedom and a great income.

She had 12 bookkeepers working for her. She charged some of the highest rates in her market place, was able to take up to 6 weeks off at a time, only worked 1 day a week in her business and eventually sold the business for over $500,000.

While this sounds amazing, it was not easy.

She made every mistake in the book along the way but instead of making those mistakes again and again she build systems around the solutions. It took over 6 years but she eventually got the business to operate more like a business and less like a job.

In this  interview, you’ll learn...

  • Some of the mistakes Debbie made and how to avoid them

  • How to get staff to take ownership

  • One resource that changes the game completely (Plus you can have a free copy by signing up for our FREE RESOURCES)

To find out more about Debbie and Pure Bookkeeping, you can visit any of the below:

http://www.PureBookkeeping.com

Facebook https://business.facebook.com/purebookkeepingca


EPISODE TRANSCRIPTION

Michael Palmer: 01:26 Hello. Welcome everyone. To another episode of The Successful Bookkeeper podcast. I'm your host, Michael Palmer, and again, today's topic of actually brought Debbie Roberts back. She was on our first episode and if you haven't listened to that episode, I recommend that you do at talk. So a lot about how Debbie got started, who she is and the great success that she got to in our business. And we're going to talk about that a little bit more today, but we're going to get into this whole concept of building a system dependent business or systematizing your bookkeeping business and you know why it's important and how this really system I've systematize nation, if you will, is really the secret to getting more freedom in your business and as well, making more from your business. And so Debbie's going to get into that. She's going to share how she got started with that and how she actually created it.

MP: 02:19 So thank you again. I'm going to welcome you, Debbie. You, you're the co-founder of Pure Bookkeeping. You are also the author of E-myth bookkeeper, which you cowrote with your co-founder of pure bookkeeping, Peter Cook and as well Michael Gerber. And I want to just spend a little bit of time Debbie talking about the concept of EMF because e-myth is this book that was written about 25 years ago I guess now and is sold 5 million copies. It's in all sorts of different languages. It really is considered for small businesses. It's considered the Bible of small businesses because it really sheds light into how you can get freedom from your business by building a system-dependent business versus a people dependent business. And that's really where you know that was one of the first books that Peter Cook had you write in your early days of your career as running your own bookkeeping business. And we want to get into that a little bit today. And as well, and EMF bookkeeper, you wrote all about the systems that you built and how you did it in the mindset of, of a bookkeeper that's going to take their business to, you know, 100,000 right up to beyond $500,000 a year. So, um, welcome Debbie again and let's get into it. 

Debbie Roberts: 03:40 Thank you, Michael. 

MP: 03:42 So Deb, when you first started, Pete said to you, Debbie, if you could get all of the information out of your head and onto paper in a way that other people could follow it, would that give you more trust in what they would be doing with your clients? And you kind of, that was there from the first episode. That was where the light bulb went off for you. Tell me a little bit about how you went from that light bulb going off to actually building the system that you built in your business, which is thousands of pages of, of standard operating procedures that direct your staff, uh, and now direct hundreds and hundreds of bookkeepers around the world to run their business in a system-dependent way. Tell us how you got started doing that. 

DR: 04:25 I think it was, well that at that first meeting with Pete said that a back getting the stuff out of my head. He also gave me a copy of the original email that you mentioned by Michael Gerber and I devoured it and I've spoken to lots of people about that book since then. And it was a game-changer for me is like, it kind of brought all the pieces of the puzzle together in my mind about what was going on in my world. He identified, he verbalized what was going on in my world. It was kind of a little bit freaky in some respects because I thought, how can he know my world this well? He doesn't even know me. How, how can he, you know, it's, it's resonated with me so powerfully that it created a paradigm shift in the way I was thinking. It was not one of those, Ah, I get it now. 

DR: 05:19 I know, I'm trying to run my business like a technician and just work harder and faster and not smarter. So that's, that was the beginning of that journey. So I devoured that book and I must savvy, you can imagine he was my hero. And, uh, when he asked me, they, he'd heard about Pure Bookkeeping and the journey that I'd been on, and he asked me to co-author that book. Uh, that was, I couldn't, I've nearly passed out. I was just so over the, over the moon overall by, um, by that privilege. It was, it was a wonderful, um, wonderful acknowledgment. But dating back to the systems. So we're talking 2002 probably. And even by then I needed, I needed staff, so I didn't have any recruitment processes. So the first two staff, well, in fact, the first several staff that I put on were people that I started asking people, do you know any other? 

DR: 06:25 If you've got any friends who are bookkeepers because I thought at least if I've got a friend of a friend, then chances are there'll be good at what they do. The chances are, so one of the first bookkeepers I put on, uh, Janet, the way I, cause I didn't have anything documented. So that whole concept of taking stuff out of your head and writing it down. In 2002 I didn't have a laptop, I only had desktops and I had a home office. So I had a desktop and I had another desktop set up in the night. We took over the lounge room and I had another desk set up there with a desktop computer and I would bring the bookkeepers into my home. And as they started doing the work. So I would be handing over the work of a particular client that I'd been working on and I knew very well and I would literally sit next to them in the chair next to them, literally watching every keystroke what they did. 

DR: 07:24 So for the whole session now of as they were doing that, I would explain what my system was, uh, and the way I went about certain things. And because I didn't have a laptop, I would write it out on a sheet of paper and then when I left, I would then type up those notes and for the next session, I'd have those notes typed up for them and have them throw the notes. And if there was anything, if they would ask a question, I'd say, okay, I haven't got that detailed enough in, in the notes. Let me add some more points to that. And when they left, I would amend the document, print that out for them, have that beside them and they would continue on with that. And that's how it, it grew from one page to thousands of pages and thousands, tens of thousands of words of what it is now, and it is in that level of detail. 

DR: 08:21 You do need to be that detailed. One of the mistakes I made was assuming bookkeepers would do so much the way I did. That would surely your bookkeepers would know how to reconcile a bank account. So, anyone that knows their stuff, we've known that a reconcile a bank account. But what for me is if you look at what is best practice bookkeeping, what I found, I started to think about, well what is it that I have seen that bookkeepers do wrong? And one of the things, just to give you one simple example was that over and over and over, I would see bookkeepers who would actually reconcile the bank accounts. So they would tick reconcile, but there are 10 1520 any number of old transactions unreconciled in the bank account and the impact of that on the client's data, it actually throws up everything. It means that things have been double entered, which affects the profit loss and the balance sheet. 

DR: 09:25 It could affect tax returns, it could affect filings, compliance, stuff that you've filed already previously. I would fix everything. And I would have bookkeepers that would, would have these transactions. They're not saying and they'd say, Oh, I've reconciled the bank account and I'd say what are days? And then Sarah will die with a from before. They're not, I didn't do those so they're not any of my business. They are your business. This is now you need to take ownership of this damn farm. This is not clean. There is a problem there. And I would explain what the problem was and then we would go about finding out what the solution wants and where the errors occurred and fix that up and read, do reports and change things as required. So when, when you will creating the systems, it's, you do have to do it in the level of deep in that level of detail and don't assume that that the bookkeepers are going to do it the way you do it. 

DR: 10:28 Another mistake I made or it wasn't so much a mistake I made. It's something I learnt about systems very early on in the piece as well was that this was actually, I was doing the bookkeeping for this client and he disputed the bill and because I did the work and I've got integrity and I know what I'm doing and things like that, I hadn't actually documented exactly what I'd done. I was cleaning up the data file and doing PR. I know I've done it. I did bank recs and things like that and I could pick, generally speaking, but I didn't know the detail what I'd done because it was by the time a question did the bill, the work was already for six, eight weeks old and there's no way, I couldn't remember what I did yesterday for a client if I didn't write it down, let alone six or eight weeks ago. 

DR: 11:17 So that was where one of the most important systems that I created was what I call the session checklist. And that was a checklist that all our bookkeepers had to complete to indicate exactly what work was done for every single session. And that solved the problem of clients disputing the bill. So that was, uh, that was a really important checklist that I created as a result of something that went wrong. This client was disputing my bill. I couldn't believe really about it, you know, I couldn't prove it what I'd done. So this checklist along with other reports that you save, you need to have a way of proving the work that was done. And, and that's also part of your audit controls as well. So that's a really important type of system that you would need to create. 

MP: 12:19 well, it, it really, what I love about this, and I think what the listener can take away from is, is that systems are really well built when you solve problems with a system. Yeah. And so you started documenting it. So tell us a little about those early days with, you know, this little notepad, you're sitting there, you're writing it out from that to thousands of pages. How did you keep it all straight in your head? 

DR: 12:47 That's, that was something that evolved as well. Um, I, I basically really Roche the bookkeeping manuals every year for 10 years for the first 10 years of the business. And then now we're modified after that. Certainly, the first six when I was really developing them, but then they were all modified every year after that. That in itself, imagine the time, I mean pay dolphins use the, um, the analogy that it probably took me about two years full time to write the systems that I did over a 16 period. Um, and uh, that was, yeah, that was at great cost. So developing the systems, it was one of the most difficult things was to work out what it, what is it that I'm going to document? There are client-specific instructions and then there are general bookkeeping instructions and how am I going to document those? And, and for, for a number of years, the two were two types of instructions were melded, if you like, into the one document, into the one manual. 

DR: 14:02 Um, and that was a problem because when, if I left a client or the client left for whatever reason, they took away basically all my intellectual property cause I had the, the system if you like, um, embedded in the client's manual and I woke up and it was a, was a significant problem that I needed to solve and I didn't know what the answer was and I slept on it and slept on it. And I remember waking up one day thinking, I know what the answer. I've got it. I've got it. I've got it. I am actually going to separate this. I had a manual that we call the client's bookkeeping manual, which I, which is client-specific information. And then I had a best practice bookkeeping manual, uh, which, which became the pupil keeping system. And, and the two Ed was easy to separate that if, if a client left, they just got the client's bookkeeping manual because that's, that was a manual that was written. 

DR: 15:00 They pay for that to be written. That was done on the, on as it was timed. So as part of the bookkeeping, they were charged for the time taping to create the manual. There's a lot of benefits with, for the client of having a manual, it means if I have to replace a bookkeeper or if they go with a different bookkeeper all together they keep that manual and it ensures that there is a smooth transition from one bookkeeper to the next because you don't have to keep restart explaining again from the start, okay this is my business, these are my bank accounts, this is my staff, this is when they get paid, this is the filing system. All those sorts of things. You don't have to repeat that cause it's all in the client's bookkeeping manual. And that that was actually a significant, a breakthrough for me when I realized that that was the solution to that. 

DR: 15:51 And then I just needed to focus on developing the systems for best practice bookkeeping and that developed over the years based on feedback from my team. So every time, if they made a mistake, if they overlooked something, if I made an assumption and they didn't do what I assumed they would do, or they did something that they shouldn't have or something like that, I would say to myself over and over and as said in the first podcast that my mantra became, what system do I need to create in order for that to not happen again? Uh, so went from a notepad to typing it up and then if the question was, well, how do you sought this stuff? And that was, that was actually another epiphany for me. What I found was, even though I had, this is going after several years, so probably three or four years, and I thought, right, I've now got my system documented, the bookkeeper should be able to follow that. 

DR: 16:49 And when I put a new bookkeeper on, I said, go and read that manual and there are the templates and come back to me when you've done that. But what I found was that they still needed way too much training. And I thought, why do they need way too much training? When I've got it, they would ask me a question, I'd say, well, it's in the manual and haven't you read that bit? And I would go straight to the menu because I knew it back to front, of course, because I created it. And it was frustrating for me because they weren't learning what was in the manual and they didn't know where in the manual that they could reference it. Um, the, the question that they had. And so I thought, right, what I'm going to do is I'm going to create a video and I remember this vividly. 

DR: 17:32 We've got a little beach house down on the coast in Victoria and that was going to be my summer holiday project. I had the system set up on my computer and what I thought I'd do was I'll, I'll just take the manual with me and I'm just going to read from the start of the manual all the way through and create the screenshots and the video and when I need to do to explain that, and I thought maybe that I learn differently. Maybe it'll be easier if they watch a video. Anyway, I started the recording and I've got down to the first page and I'll stop the recording and I went, but then if you put that there, that actually that's got nothing to do with this. It's kind of some random Clomid that you've thought of that you've put in this spot, but it actually has nothing to do with anything else on that page that actually belongs over here. 

DR: 18:26 And I close the book and realize that I needed to rewrite my manual because it, although the, the information was there, it wasn't ordered, there was no logical order to it. So that was another then 12 months of working out with what order, what is the best audit to put these in, what is logical, how are my team going to be able to search for stuff themselves? And that thing came to what we've now got in the pure bookkeeping system and the way I've ordered a bit, which has logic and uploads on and everything is in its right area. 

MP: 19:09 Wow. 

MP: 19:10 You know, I'm sure people are listening and, and thinking to themselves, that sounds like a massive, massive undertaking and a massive project. Where did you get the time to do it? 

DR: 19:25 And you hear this all the time, and I've, I've made the time, um, know I didn't have time. I didn't have to. That's it. That was one thing that I said to Pete, uh, on that first day when, when he said, uh, do you think you'd, you took everything out of your head and wrote it down and taught someone to follow up. Would that work? And I said, what time of the day am I supposed to do that? Like midnight to dawn? I mean, seriously, I'm really full, I've got no time to do this. That was my exact words to him. I still remember that vividly. However, what do I want to, I just made it happen. I shifted things that I had a choice at that point in time. If I couldn't find the time, then what I needed to do was not grow my business. 

DR: 20:09 So that was, I mean that was a choice and that's, that's not a bad choice. I mean, I could have just selected, I don't know, a dozen clones or maybe 20 clients of my clients are the ones I loved and loved the work and it was challenging and interesting and things like that and just said no to everyone else. I just basically closed my books, not recruited, not put on staff, not growing my business that way. But the reason why I, I chose not to do that and chose to grow my business is because I found it impossible to turn a client away. I had clients who came to meet prospects, so people who'd never met me before who came to me and were crying at the first and our first initial meeting because of the mess that they are in and Mohammad is probably going to, cause I knew that I could fix it and it kind of felt, it just didn't sit with me that I'd say, Oh look, I'm sorry I'm not taking on any more clients. 

DR: 21:10 I know I, it just didn't sit with me. I needed to find a solution. And if that meant the solution was writing, creating systems and training someone else, I had to find the time. Otherwise, the option was to wind down and just choose those number of clients. So yeah, I fitted it in, I prioritize what needed to be done. I recruited more and got more people on to take over some more of my clients, changed the model, I made a model more profitable. That's another whole story in itself. I'm not sure if we've got time for that today, but in making your model profitable, obviously, that's, that's the key. And there are some models that are just it just because, and it's largely because there's not enough systems in place that means the model is an unworkable and unprofitable. 

MP: 22:04 Yeah. And I know in conversations in the past with you, which we don't have time to get into them all today, but you know, we're gonna, we're gonna get you back again and again. Again, I can tell already the listeners are going to have a whole bunch of questions and want to learn more from you Deb. So, but I do remember back in the conversations that we've had is that you for a long time had this question of is it actually possible to grow a bookkeeping business with multiple staff and actually be profitable? And that was a question that actually didn't seem like it was possible for a very long time and nearly put you into bankruptcy, which again, as a story for another episode. But you know what I'm hearing in this Deb is a couple of things. Number one, your incredible commitment to excellence in your business for your customers, right? 

MP: 22:50 And so you really saw how systems were going to be an access to actually delivering a wow level service to your clients. And it's not surprising that you know, you've got clients that have been with you for 27 years, I think you mentioned in the first episode, which is, which is insane. And I mean it's just a testament to the work that you do. And so, you know, this is really been a good, I think, a good introduction to systems and how they’ve created and the incredible amount of time that that's required to build them. And you know, there's a saying, there's never a good time to be interrupted. Well, there's never a good time to work on your business. You have to make that time. You have to carve it out somewhere. I mean it's, you made sacrifices to actually do that, but now, you know, in the long run, it's like people look and they see you, you know, taking six weeks vacation on a, and that's, you know, it's like, well, how come you're so lucky? 

MP: 23:42 Well, it's because you didn't have that vacation and you took time away from your family and your friends and the things that you like to do to invest in your business. And there are no overnight successes. There are no quick wins. It takes time. And that's something we all have to listen to. I know when we're working with our clients, bookkeepers and it's like they get frustrated because you know, it's been, you know, three months and they're not, you know, they haven't built the business that Debbie Robert built. And I keep telling them, it's like, look, Debbie struggled for years. It took her six years to get it to the point where it was running itself. Don't expect you're going to be able to do all of the things we're talking about in the Successful Bookkeeper podcast and the name of bookkeeper. It's not going to happen in six months button. Every single step you take, everything you do, it's one incremental thing that's an improvement on your business, adds up to being a whole shift in your business. And someday you'll look back and you'll go, wow, I can't believe I've gotten this far. And that's, that applies to all areas of life. Whether we're running a marathon or we're becoming an artist or, or starting a business. 

MP: 24:49 So Deb, let's end with, you know, there are people out there right now thinking, okay, I get it. I need to start. Uh, I need to start systematizing my business. What is your recommendation for them to get started? 

DR: 25:01 Think about what is it about the way you do your bookkeeping that is fabulous that your clients love that accountants love? Probably the easiest way if you've got staff is to sit with them and start documenting it as you're training them. If you don't have staff, it can be kind of thinking, oh yeah, well I don't, I don't need to get into this yet because it's just me. It's much easier to do it when it is just you. So think about when you're a start-up practice, think about what it is that you do that your clients love and accountants love and keep referring work to you and put in. It has to be an excruciating detail. One of the, one of the mindset changes that I made was everything that I was doing, I was, I thought to myself, this is not me doing this. 

DR: 25:55 It's not, I am not doing this. So if I was sitting there doing data entry for a client or things like that, I'd be saying, this is not me. Someone else has to do this, would they understand what needs to be done for this client? And that actually led to other conversations as well because sometimes clients were disrespectful or they wouldn't turn up. They wouldn't provide the paperwork to me. I turned up to the client's premises and the door was locked cause they forgot that I was going to turn up, would I? How would I feel if that happened to one of my team? Sometimes when we're, when we're on a Whoa, we tolerate a behavior from clients that is less than ideal and sometimes quite disrespectful. Think about that now. And that's another system you need to put into place. What are you going to do with this client? Who's disrespectful? How you going, what conversation you're going to have? Are you going to actually keep them? So if someone is disrespectful to you, then think about, well, what's that going to be like for a bookkeeper? One of my team, one of my precious team members, would I, would I let them put up with that? And the answer is resounding, no, you wouldn't. So why put up with stuff yourself? 

DR: 27:13 So some of the systems that you'll be creating the, around how the bookkeeping is done, some of them will be around, um, your relationship with your clients. Some of them will be around how you run the backend of your business, how you, so the administrative processes, what happens if you've got a team member and you just, you create something like the session checklist that I mentioned. What happens when that arrives back in your office? How do you, what's the process for how you check the work that was done? How can you guarantee the quality of the work? How can you be sure that the number of hours that the bookkeeper's done is the right number of hours? There's a lot of stuff that we have in our heads that you take for granted. That's why it took me six years to write the system because I overlooked lit what I considered to be little things. 

DR: 28:05 And it was only when questions were asked by my staff that I thought, oh, that's actually not a little thing. Yes, I need to expand on that and make sure I've set the right expectations and I need to create this other document or, and these days obviously with all a lot of stuff being online, there's a lot of CRMs that are available for you that you can utilize to track where the work is at. That's what, that's another system that you've got to do when and so when you're starting up, think about you, this is not you doing the work. This is someone else's going to do it. How are you going to know they've done that work? How are you going to track when they're going to do it? When's the next sort of processing? You cannot keep things in a diary. You can't even keep it in your own app. Look, you've got to have some kind of um, uh, y some kind of system to be able to track where the work is, what stage it's at, and also to be able to check the work as well. 

MP: 29:02 Fantastic. I think those are just a whole, there's a whole bunch of gold there and so excited about having you back. And you know, there are so many topics I want to get into Debbie and we're definitely going to have you back really soon for another episode and get into some of these things. Um, so thank you so much, for sharing with us and for being our guest. You're welcome, Michael. It's been a pleasure. Absolutely. So a few things for the listeners. We've got some really great things now, Debbie has graciously offered to um, to make available the session checklist that she talked about today. It's actually one of the, the, the resources that she gives away with her book E-myth bookkeeper. If you buy EMF bookkeeper, there's a whole bunch of free resources that she gets samples from the system she created and all of that. 

MP: 29:51 So I recommend, obviously you are going to want to buy EMF bookkeeper and start reading that and get all of those. But as a, as a treat, Debbie's offered to give away one of those resources are at Thesuccessfulbookkeeper.com. So if you go there and just simply go to this episode, which is episode number four, and you'll see a place are, we can put your information in and download that as well. We really, really want you to subscribe on iTunes and if you go to Thesuccessfulbookkeeper.com/reviews, there are all the instructions on how to subscribe on iTunes and leave us a review and a rating. Let us know what you think about it. And as well, if you do that, we're actually going to be shipping out for a limited time. We're going to be giving away shipping for free, absolutely free. You don't have to put your credit card in or anything like that, but simply leave us a review on iTunes and we're going to mail you a copy of the brand new book that's coming out this September, The Successful Bookkeeper. 

MP: 30:48 It's a story of Debbie Roberts and Peter Cook and, and all the wonderful things that they created inside of their business. Uh, from the perspective of me, a business coach looking at them and how they created this, we're going to ship you that hard copy to you. All you need to do is leave the review and there'll be instructions there. Give us your address and information and we'll ship that out to you, which is super exciting. The last thing I want to say is we want to hear from you. We want to know what questions do you want to ask our guests, Debbie, we're going to have Peter on. We're going to have a whole bunch of other resources that are really valuable to help you around the mindset of your, of your bookkeeping business. And so if you go to the successful bookkeeper.com forward slash questions, there is a place there where you can actually record a quick question and let us know and we'll get that instantly. And we'll include those few in future episodes out of the successful bookkeeper. So really want to thank you for participating, for listening in, 

MP: 31:43 and we look forward to hearing from you. So until next time, ah, that's another podcast on the books. Take care, everybody. Bye for now.