#8: Living Lean

Welcome to the Business of Business - Two Daughters & Their Dad Podcast!

The Dempseys have discussed "leaving lean" in several episodes.  Today Staci, Jennifer & Jack talk about what it really means to live lean.  Why is it needed and what lessons can be learned and applied to your new business venture

The Dempsey daughters share a few ah ha moments as they realize how Jack applied living lean to his family 30 years ago while in the early years of starting his business.

Jack also talks again about the Sigmoid Curve and how it is vital to understand this principle before starting out, plan for it and know how it applies to your business. 

https://uplandsoftware.com/cimpl/resources/blog/the-sigmoid-curve-a-model-for-constant-business-growth-and-innovation/

But who are the Dempseys?

Jennifer Faith Dempsey has been in the beauty industry for over 10 years. The last 3 1/2 years she has owned J.Faith Hair Studio. She brings her experience on how she balances entrepreneurship and motherhood.

Staci Joy Dempsey is an insurance agent, a mom and a busy non profit volunteer. She truly understands what it means to be an entrepreneur.  Staci serves as the podcast's host.

Jack Dempsey is the dad who heads up this busy family.  He is a founding partner in Dempsey, Weiss & Associates, an Elmer, NJ based insurance and investment firm begun more than 30 years ago.

The Business of Business podcast is sponsored by:

Dempsey, Weiss & Associates, Elmer, NJ,     856-358-3900

J. Faith Hair Studio, Logan Township, NJ     856-975-5965

Email us at: TwoDaughtersAndTheirDad@gmail.com

Please download our Best of Nuggets eBook here.

Like and follow us on Facebook

Jennifer Faith Dempsey has been in the beauty industry for over 10 years. For the last 5m years, she has owned J. Faith Hair Studio. She brings her experience on how she balances entrepreneurship and motherhood. Check out Jen’s blog.

Staci Joy Dempsey is an insurance agent, a mom, and a busy non-profit volunteer. She truly understands what it means to be an entrepreneur. Staci serves as the podcast's host.

Jack Dempsey is the dad who heads up this busy family. He is a founding partner in Dempsey, Weiss & Associates, an Elmer, NJ-based insurance and investment firm that began more than 30 years ago.

Transcript

Staci Dempsey:   0:00
Hey there and  welcome to the business of business podcast. Here we are two daughters and their dad seeking to inspire and educate you to follow your dreams of being in business by teaching you the business of being in business.  

Staci Dempsey:   0:13
The good, the bad, the humor are all parts of our unique perspective as an entrepreneurial family. Thanks for joining us.   So grab a coffee. Turn up the volume. Here we go.  

Staci Dempsey:   0:26
  Hi, everybody and welcome back to our podcast, The Business of Business. This is two daughters and their dad.   I am Staci J. Dempsey, the host.  And the J is very important cause it brings the joy!   I have with me today somebody's father, somebody's daughter who else is here with me.  

Jack Dempsey:   0:45
Dad's here.  Dad.

Jack Dempsey:   0:47
Daughter is here. Jennifer.   Nice to see you guys!

Staci Dempsey:   0:49
So today we are kind of still talking about the process of living lean.  We have done one, maybe one and a half podcasts now about what that is and why it's important.  Today we really wanted to talk about real life examples of how we live lean.

Staci Dempsey:   1:12
Obviously dad is in a different place in his life so maybe he lives lean in a different way, or he can say just what the fruits of the labor of living lean have been.   We just thought it was really important to talk about what our real life examples are.  

Staci Dempsey:   1:31
 How do we how do we live lean, day in and day out.  What are the choices that we have to make - whether they're big purchases or small purchases.   How has all of that together positioned us in our business for the long haul;  for a better financial future. So, Jennifer, I'll start with you because we have talked about lifestyle changes and things that we have to spend our money on.    Last year you had a baby, and that alone brings joy and a lot more bills.   I know this because I pay them.  Ah, I pay my own bills, not Jennifers,  so let's be clear. I pay my bills.   So, in just kind of transitioning from not having a child to having a child, what does like living lean look for you now?    

Jennifer Dempsey:   2:35
Well, I think it's important we might have mentioned it before.  When I set out to open J Faith Hair Studio, we were talking about a complete lifestyle change.   Living on my own, living in an apartment, having a car,  being 100% independent.   When I opened the salon it was a huge lifestyle change.  I moved back in with my mom, cut all my expenses and just really tried to make sure that I didn't have a lot of bills.  And what did that look like for me?  as I said I moved back home with my mom, and I really just stuck to the most important bills and not having any credit card debt. Then I did not take a paycheck from this salon for the first year.  

Jennifer Dempsey:   3:27
Now, I know that that can be hard for some people.   I mean, I get tips, so I did have a little bit of income coming in to be able to pay my car payment & my car insurance, But, there was not much else other than that.  Obviously I had some money I received at that time, but, it was still a very scary situation.   After about a year of the salon being open I was able to start taking a paycheck.  Now,  3.5 years in. I still don't take a full paycheck;  I'm still investing in my business.  I am not taking what I would normally get paid if I worked in a different salon.  

Jennifer Dempsey:   4:10
So what does that mean for me in the current day?   I still try to make smart decisions. Thankfully, I have my family to help me.  I did have my daughter.   She just turned 15 months.  When I had my daughter that became a priority and that I had to start making a little bit more money.  What did that look like for me?  Well me and my daughter still have the opportunity to live rent free,  mortgage free with my mom. That alone is what helps me be able to still not take a huge pay check from the salon.

Staci Dempsey:   4:56
And so Jack, I'll send this over to you, because I feel like living living lean might be a little different to you.  Now that you're in a different phase of life, a different stage in life.   I know Jennifer and I have talked like we certainly have the stories of as that is an adult,  thinking back I'm  thinking that Dad was living lean. That he was, in hindsight why dad did those did those things.  

Staci Dempsey:   5:29
The one story that comes to mind is when we would go out for ice cream, You never got your own ice cream. And so now that I'm an adult, I realize now that number one that was a cost savings and number two is also a calorie savings because you knew we were going to need help with the ice cream that was frantically melting our arms. And so you had to "help us out" with it.  And so therefore, you still got your ice cream, but probably not as many calories as eating your own and ours!  The cost savings now I'm like that's genius!  These are things now I do myself.   Like, you know what?  You guys order what you want. I'm gonna get a salad knowing that I'm gonna just probably eat your leftovers anyway.  So dad, what are some things that come to mind as far as living lean in your experience and in your mind for people today to think about.

Jack Dempsey:   6:28
Well I just want to go back for a second.   We've talked about this a couple of the prior podcasts, and I just want to remind everybody about the sigmoid curve. You know, the reason that most businesses don't grow or plateau is because they don't understand the sigmoid curve. They don't understand that in that start up phase there is gonna be some challenging financial times. Many businesses can endure that are many people who start businesses can endure that. But then once the business stores to grow, cash flow starts to come in that's when you that's when it gets hard. Because going into most businesses I'm gonna have to live lean here because I have to invest back in my business, right? The challenge is when the business starts to do well and you have cash flow.  

Jack Dempsey:   7:30
The thing that most business owners and people want to do is then begin to take that money from the business and build their  lifestyle  and invest, in more lifestyle choices. But that's where the mistake is made.   Because in the sigmoid curve, you have to begin to look in that growth stage and think when am I going to start the curve over again?   And that's the challenge is because now you're realizing, OK, that doesn't mean I am going to be able to increase lifestyle, because I'm gonna have to start that curve over again in order to keep my business growing. 

Jack Dempsey:   8:09
  So I just wanted to kind of remind ourselves why we're talking about this because if you're looking to grow a business, you have to understand that part of it.  So what does it mean to live lean Well, first of all, I think is important that you have to look. I mean, if you're you already in a lean position, that's great, because Now you don't have to undo things or figure out how to undo some things. Just commit to staying lean. And however whatever that looks like for you, um, if that's, you know ableto, you know, still live with parents or live with family so that you can keep your housing costs down. That's great. Um, if you don't not in that position and certainly look for ways that you can live, you know, you know in a way that you don't have a lot of, you know, housing costs and and certainly entertainment costs and all those things. But, you know, if if you're already, um, have built some lifestyle and you have to, you know, figure out a waiting, get some cash flow Well, you've just got to just put everything on the table and you're gonna have to say, Alright, what can go? I mean, if you're truly committed to this entrepreneurial dream that you have and you've got to be willing to let things go, that could be letting go of, you know, your cable bill. Your, um, some of the things that you enjoy every month, you know, you have to let some of those things g o s o that you can have that that cash flow necessary eso Because, like in Jennifer's case, you know, she went for quite a while without taking a paycheck. Well, you need to go into your business understanding that you're not gonna be able to take much income out of that business. It's about paying your bills, reinvesting, growing, and so maintaining again that lean end of the tube of toothpaste lifestyle is really what's going to get you there. And that's where also, what's gonna mess you up if you don't pull that off? So you need to think of things like budgeting. You don't have, You know, a very strict written budget for your personal finances. Track everything, track every penny so that you know where every penny is going, um, in your personal budget, because you will be amazed how much money you confined in your budget if you track so that's one tool budget and tracking your spending patterns. So, um, the other thing is just understanding that, um, when you are spending, if you have a situation where you have a family again a little bit tougher, because obviously you've got more than just you to be concerned with. But communication that's very critical was communicate to your spouse. Um, if your kids are old enough to communicate, you know about what your division is the dream. You have to keep that communication because again they're gonna have to have some buy in to this whole thing. So be creative. You know, it's like, all right, we're not taking a vacation because we need to take that money and invest in the business or build margin to have some safety net under us. But, you know, but figure out creative ways to, you know, have fun and be get out. You know, just, um, it's it's amazing when you talk to people who, um, have had success. And when they talk about those lean years, many times, some of their happiest times is when they were broke, because then they had to get creative. Then they had, you know, they had to figure out OK, how can I take my kids, you know, to the park, you know, and have a enjoyable day and and build a memory. You know, when we have money, sometimes it's like, OK, I can afford to take him to this amusement park and, you know, buying a wristband. They're offered running. And, you know, and you know, sometimes it's just not the same. So but asking your family to sacrifice and things like that, but don't torture you. Make sure you you you know, you're looking for creative ways for them to still have things and build memories, um, and spend time with him. So, um, those air just again. Some things I'm thinking. I mean, I've, you know, some practical things is, you know, even going out to eat, you know, making sure that you know what? When we walk in his door, you know, you could order what you want to eat, but we're drinking water, you know, because if everybody orders a drink, where does that? We're adding $15 to the to the bill. So right now, I'm just telling you right now, we're drinking water. Um, if it's a special night and you're taken, you know your significant other out. Well, And you like a glass of wine. Find a B Y o B. No. Spend 40 bucks on the wind. Take, You know, that same bottle wine that you come by for 15 bucks and do A B y o B just things like that. Those little decisions, you know day in and day out will really make a difference and making sure that and again. And it builds creativity. You know how to think things through. So so again, those There's just some things that come to mind.

Staci Dempsey:   14:00
So at one point I mean you were started A. I started a business well moved away from basically the life that you that you had in West Virginia. I started a business, came up here kindle New Jersey with two kids and two on the way. And I mean, I can say from because I loved it. I mean, I never felt like we were without. I never felt like we were broke or anything like that. But in hindsight, I'm thinking we probably had some tough months and there's somewhere along the line. I mean, I never felt that way. I never felt like we were going without, and you talk about going out to dinner and we were just saying like, you know, if we went to Pizza Hut on Friday night, I mean, it was like we were like it was we just It was like, our thing. I don't know. We just had a good time. It was just fun. And your son you're going? Yeah. You know, six people on 20 bucks. Even that's

Jennifer Dempsey:   14:57
too large pizzas, breadsticks and a pitcher of soda for 20 bucks. Right? We pulled it off,

Staci Dempsey:   15:03
right? So it was more about, you know, for whatever reason, I don't know if it's just the fact of going out or us all being together and doing something and, you know, so

Jack Dempsey:   15:13
we'll talk about being creative. I remember when you first opened the office and I think we came on the weekends to clean it right and plant flowers, and it it didn't seem like Oh, we have to go and clean the office or do land sieving. It was fun because we were all together. Didn't seem like anything that was out of the ordinary,

Staci Dempsey:   15:32
right? Exactly. Somehow Dad made everything fun like it was like, Oh, my gosh, we get to do this. So you know, when you know about the town, how you know, we moved to New Jersey and it was all new construction. And you weren't you were just born. So you remember. But there was no landscaping. There was no grass. It was just dirt for backyard. And in order to grow the grass, all these rocks had to be picked up out of the earth. There's nothing there but earth. Right? So on the weekends, Dad gave Emily and I have bucket, and it was who Let's see who can get the more rocks in their bucket. And me and family were like, Oh, my gosh, this is, like, so much front, bud. Hence the freelance. Anything that okay, Like it was like, I'm gonna pay. So I got to these two little kids and dad was out there with us, too. But it was just like, you know, you think back to like, Oh, my gosh, that was just so much fun. And then you're, like, feeling like, now that was like a, uh, cost saving tactic and all scheme of things, But well, it worked. It worked really well. So Well, you know. So we've all made some like, you know, not always the best financial decisions for the budget. So do you guys want to touch on? Maybe just like a choice that maybe you knew it probably wasn't gonna be the best financial toys do you did it anyway. And then, you know you have Teoh figure way out of it. Jack's looking at me like, No, I've never done that, But, uh, well, I think that it's

Jack Dempsey:   17:05
important as we're talking about this. I was just recently talking to someone about it. Listen, I'm 30 years old, I'm a single mom, I'm an entrepreneur and there's pressure, right? Like there's pressure from the world. There's pressure to say I'm doing this this and this. So I should be this this and this. And I think that that's what it comes down to is that Are you okay with not being where the world is saying that you should be right Like I own a business? I have a one year old daughter, but we live in the house that I grew up in, still with my mom and and so to the outside world, that seems like that doesn't make any sense what's going on right? But to make this lifestyle work and to be somewhat comfortable, right, like I don't want to be struggling with my daughter, we I want to have some comfortable lifestyle for her. I'm gonna take the sacrifice to say we're going to stay here. We're going to stay here until something else happens and that sacrifice again. It it's hard to make it. It's like, Okay, here I am, 30 years

Staci Dempsey:   18:18
old. You

Jack Dempsey:   18:18
should be out of your parents house, quote unquote, right, Right. But that's the best decision for what the goal is for me. So in saying that we talk about it like it's easy, and I think that that that alone is very hard for people to say. I don't I don't want to make that sacrifice. I don't want toe go without. I want to drive a new car. I wanna have a house. I wanna have new sneakers. So that's what you have to decide you. You know, you do you want to be an entrepreneur or do you wanna have new stuff? And that's really just what it comes down to and are you okay going against the green to say the world's telling me I should do this? But I'm gonna ignore that and do this to better to be able to invest in my business to be able, Teoh, give my daughter new clothes, new shoes, eat diapers. Then I need to make this decision, right? Yes.

Jennifer Dempsey:   19:14
Well, that's a good point, because that is what gets a lot of people is that is that comparison. You know, it's, you know, the keeping up with the neighbors, and you're looking at your peers in whatever business you're in after a certain period of time thinking, you know, um, you know, their their life looks a certain way, And I'm wanting to keep my life looking, you know, lifestyle under that level. Um, but it's hard because, you know, you also want people to look at us having some level success. So, um, you know, I think one of the biggest, the biggest things that you can really do to help your budget I'm talking about something we did when I was younger and still do today is, you know, I buy good cars, but I buy him slightly used like other people eating the depreciation on him, and I either pay for it, um, or pay for it very quickly. I'm these days, I pay for it and I driving for a long time and I put a lot of miles on. So right now, for example, my business cars a 2011 Ford tourists that just turned 211,000 miles. Good car. Still going strong? Could I afford something a little bit newer than that and a little bit nicer than that? Yes. Um, but But here's the thing is that's, you know, that I've always been that way. I've always bought again. I'm not, You know, I'm not gonna bide a piece of junk and drive a piece of junk, you know, up front, my client's business. But, you know, I'm also not gonna buy, you know, a car that you know is way more than I need and way more expensive. And so, even though I'm in a better position to do that today because I've always done it, I'm comfortable with it. You know, I'm comfortable. That's like Warren Buffet, whose like Worth 50 or $75 billion lives in the same house that him and his wife bought back in the 19 fifties for $35,000. You know, it's just not important telling, you know, live in him. He could live in a 50,000 square foot mansion if he wanted to. But it's just not important. And that's what you'll find is if you practice, you know, that type of lifestyle living. Then when you do get to the point where you can afford more things, then you realize that it's not that important. So so again, but vehicles Jennifer are, um, you know, a losing proposition. And so that was probably the one thing Jennifer and I had a little difference on because she bought a brand new car recently. And then I told her

Staci Dempsey:   22:23
not to dio I just want to be on the record that

Jennifer Dempsey:   22:25
well, me too, but that But again, um, she needs something a little bit bigger. Um, you know, to handle the baby and all that goes with that SoCo completely understood that. But I would have liked the scene or by something slightly used. And, uh, but again, I didn't go that way,

Jack Dempsey:   22:47
but different.

Jennifer Dempsey:   22:47
A little bit different. So

Staci Dempsey:   22:51
so Well, excellent. Well, on that note, we will then end this podcast. We want to thank everybody for joining us in until next time. Uh, we'll see you next time way. Want to thank you for listening today. Please subscribe. So you never miss an episode. Leave us a positive review and we want to say thank you to our sponsors, Dempsey Wasting Associates and J. Faith Hair Studio.