Giving and Culture - Purpose and Values - Success and Exceptional outcomes Episode 66 Karl Schwantes 5 Star Google Review

I had an epiphany while listening to this episode. 

There is no villain in Karl’s story. He hasn’t had to overcome any massive tragedy, or Phoenix rising from the ashes. In fact it’s an unremarkable success. But a great story nevertheless.

Karl’s story is about his progress from taking over the family business; creating a business that reflected his values and purpose; building a culture that allowed him to be in control and let go of managing; and finally having the time and money to pursue another passion.

The conversation with Karl reinforced what I have been espousing to anyone who will listen that it is possible to create a business that is independent of your daily involvement. 

That way your business is more valuable and you get to do the things you love.

Intellectually you would know this. But it’s the emotional connection to your business that holds you back and the lack of a North Star to draw you towards a purpose.

There are some gems in Karl's story.

Karl Schwantes Managing Director, Xennox Diamonds / My 5 Star Reviews

LinkedIn https://www.linkedin.com/in/karlschwantes/

Web Site www.xennoxdiamonds.com.au

Offer www.xennoxdiamonds.com.au

 Mobile +610403623030

Email karl@my5starreviews.com.au

Stephen Sandor CEO Inspiring Business
Inspiring Business website

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Transcript

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Karl Schwantes 0:01

I, I think there's a lot of things that, that we did, uh, I'll try and touch on as many as I can. Number one is around culture. Uh, and one of the things that I, I'm a very big believer in personal profe. I mean, I've got a library at Xennox that are books that I just buy. I read and, you know, I, there was one point where I was like, geez, I wish everybody did this. Like, if they could understand how beneficial it would be for them, you know, professionally and personally, everybody should do it. And whether it's a book or a podcast, doesn't matter. Uh, like, and so, but I was asking people to do it and no one was doing it. And so I said, okay, bugger this. I said, uh, we're gonna do it in my. So we started, you know, we started in the morning at whatever, eight o'clock, and I said, for the first 15 minutes, you're gonna take a book from the library and we're gonna sit together as a group and we're gonna read. So for 15 minutes, we would read as a team, then we'd spend the next five minutes sharing what we learned from, from the book so that, you know, vicariously through each other, we could all learn. And then we would talk about how we would apply that in the business. And then the next five minutes we would talk through like the core values. So what are our core values around the team, you know, uh, working for the greater good and all that sort of stuff. Um, and then we would talk about what was the, the on for the day, like what did you have planned, what was coming up? And so, so building in kind of simple discipline of a daily standup huddle creates the kind of the solid foundation by which, you know, it makes it very easy for people to kind of really be, uh, grounded to know, well where, where are we going? You know, so I, I would say, I would say the culture getting really cl and there's a lot, so much more you can unpack about how to, how we did the culture side of things. But, but it was just more that daily, one of the biggest things I find with business owners is that we feel like, because we've told the team something once, that they, they got it, it's okay. And, and the reality is, is that we all need daily indoctrination. It, it's that constant hearing of the message about the values, the culture, uh, what we stand for, and all of that sort of stuff makes a big difference for how people show up.

Steve Sandor 2:02

So welcome to the Inspiring Business Podcast. My guest today is Karl Schwantes, who is the Managing Director of Xennox Diamonds, a very successful second generation jewelry business based in Brisbane, Australia, with the ability to create exceptional customer journeys, and that's been the core of the business's success. As with a lot of businesses, COVID 19 had an impact on the business, and Karl was faced with some choices on how to manage the business over what was at that time, an unknown period. So I'm really very interested in hearing about the decisions that Karl made then and up until now, and what the future holds for him. In 2022, Karl launched his 10,000 Smiles campaign so I'm really looking forward to hearing what that's all about. So Karl, welcome to the inspiring Business Podcast.

Karl Schwantes 2:57

Morning, Steve, or afternoon, I guess wherever you're listening to this. Glad, glad to be on the show.

Steve Sandor 3:03

Thank you so much, and thanks very much for, for taking the time. I know you're, you've got a very, um, successful business so I, I really do appreciate you taking the time to be our guest. I'm sure there'll be lots of lessons that the listener will be able to hear from that. Before we, before we actually get into, you know, what you do

Karl's Story

Steve Sandor 3:22

now for your clients, Could you just give us a little bit of background. I've mentioned that you're in the jewelry business, you're not exactly doing that now or the, the, it's a joint effort. Um, so maybe just a little bit of history.

Karl Schwantes 3:36

So, uh, it, well, the business has been going for 47 years now, so obviously I'm not 47 years old. Uh, I'm not, uh, you know, 47 plus 20 thereabouts. So I'm 45 years at the time of, of this recording. So I've been doing it for at least 27 years. Uh, and I think like most people, if you grow up in a, in a family business, you get used to, uh, I guess just having it almost in your blood where you, you just immersed around it. Uh, you know, the, the topics at the, the dinner table were all around, you know, what was happening in the shop, a client or, or, or, you know, a piece of jewelry that was being made. And my father used to have this beautiful little, like, jeweler's workbench that was, you know, pretty much in the garage under our. I can still close my eyes now and vividly remember what it was like to walk into that workshop, you know, the smells of the oils and, and watching him like heat up these big pieces of metal and then quenching it in the water was kind of like, you know, watching something out of King Arthur and the Knights of the Round Table. So I think I, I had this great deep love of the jewelry industry and, and so, you know, about the age of 14, I started making my first rings. My dad used to give me these apprentice exercises to make, and from about 17, 18, I was working pretty much every weekend, uh, in the store. So, uh, as time goes on, you know, I left school and, and went to university, actually, uh, did a science degree, uh, at the University of Queensland, majoring in psychology. Uh, sometimes people have a bit of a chuckle about that to see whether I use that with clients, and the answer is no, but, but it's still a kind of a funny connect. Uh, I also enlisted in the Army, so I spent 10 years, uh, and finished as an artillery captain. Uh, so I love the, the discipline, the morale, the camaraderie, the, and, and obviously just doing something for your country. But I think all of these experiences through life that we have as, as we grow and develop shape who we are as a person. And, and I'd like to think that at some level, um, that has been a key factor as to who I am today. Um, fast forwarding, you know, from there, I guess, you know, spending nearly over two decades, you know, running the jewelry business, looking to grow it, um, you know, took the over the business from, uh, from my parents as they retired, uh, and then, you know, really took it into a new direction, uh, where it was really going to be all around the customer journey experience. And, and for me, a, a business mentor of mine once said that, um, your greatest business joy comes at the intersection of your two greatest values. And for me what that was, was as a child, we used to love traveling. We, you know, my, my family's German, as you probably guessed from the name. Um, and we would go every, every, every other year to Germany to visit my family. Uh, and my parents over grandparents over there couldn't speak any English. So, uh, but there was all these beautiful experiences being around, you know, the beautiful German food, the, the Christmas and all of that sort stuff, which was really magical to me as, as someone growing up. So for me, one of my greatest virtues is all around experiences. I love traveling and, you know, restaurants and all of, all of those things that come having a great experience. And the second Indi index was something around, uh, good quality products or services. So for me, I'm at my happiest when I'm doing something that's in a creative, high-end, bespoke kind of space and creating an experience around that. And I, and I remember when it was, it was probably somewhere around 2015. There are about 2016, I'm not sure exactly the date. But, uh, this whole thing about, you know, how do I give my clients like an amazing experience, but make that replicable by everybody? And what I learned, like as anybody who's listening to this can, can probably attest to, is that we all have a very different definition than our minds about what a great experience is. And, and I quickly found out that just telling someone to go out there and give a great experience wasn't in itself enough to ensure that that was gonna happen even when I wasn't in the shop. And so I came across this kind of thing around Google reviews and I thought, well, rather than ask them to go and give a great experience, what if I just said, go out and give a five star worthy experience? Now in the Army we have this thing called commander's intent. Now the commander says, I want you to take the hill. I don't care whether you got the left, the right, or straight up, the guts in the middle. Just take the hill. That's the. And so for me, the objective was, uh, I want you to get a great five star experience. I, I don't care how you do it, that's up to you. But that is the end result that I, that I'm measuring, you know, how well the experience was. And what I found was, was that it really allowed the team to lift and look, there were lots of things that we did. Like I would empower the team with, uh, boundaries. So I would say to them, look, you've got a hundred dollars to spend on whatever you like, uh, to go out there and give a great experience. So it could be sometimes shouting them coffees or paying for parking, whatever it was. Uh, and what we found is that, you know, our Google reviews just started to, to tick up. And that was a great authority asset for the business. Uh, but I still wasn't connected with just how powerful that was until 2020 came along. And I still remember I was in. With my family over there and listening to the news and seeing all this thing about Covid 19 and thinking, well, maybe this is just one of those SARS things, it'll just blow over and a month or two will be back to normal. God, how wrong was I? Uh, you know, coming back and, you know, the government are just banned weddings, which is pretty terrible when that's pretty much what you do. So, uh, almost overnight we lost about 97% of our revenue for eight weeks, but at the time we didn't know it was eight weeks. It looked like it was just gonna go on forever. And my heart goes out to anybody that's, you know, ever been in the hospitality space because they were, you know, and so many other wedding industry, uh, businesses was, were so deeply affected by, by that covid. And as most business owners, I think, you know, sometimes we get caught up so much in the doing of the business and looking after our clients and doing all of that sort of stuff that sometimes we forget to really look at the numbers. And what that ti, what that gave me when particularly cuz nobody was coming into the shop, was the time to kind of sit there and go, well, let's look at the numbers. Where are our clients really coming from? Because if I could find out where our clients were coming from, that would be the place I would go to try and find more clients. And what I found really shocked me in the previous year, so 2019, we'd had 173 sales. That sales and not leads, um, that had come from our Google reviews, which translated to more than a million dollars in top line revenue. But that wasn't even the best part. The best part was I hadn't spent a single dollar on, on, on generating those leads. And if you're as old as me, uh, Steve, I know you probably remember those old ads from the Yellow pages. You know, the, you know, the not happy. And for those of you who don't know what the Yellow Pages was, it was a big yellow book directory. And every year the Yellow Pages, um, consultant would come to me and say, well, the ads are gone up a thousand or $2,000. And I'd say, why? And they say, well, because we are the only ones who have the book. And if you lose your spot, we'll give it to your competitors and you'll never get it back. And so, you know, you contrast this from that traditional print advertising to what became later on digital, which was great cuz you could track it. But where I see that we are going now is we're really moving into that reputation age, which is, it's all about your, your reputation online. And, and today people are more time poor than they've ever been before. You know, we just wanna look at, on Google who is the best, you know, where are the reviews? What's the, what's that look like? And that's where I want to go. And provided you do a great job when they come, you're very likely to get them as a. And so from there, uh, I really started to pivot where I wanted to go. Like thinking of my next chapter. I, I sound so old when I say that my next chapter in life, but um, you know, I'd gotten the business to a point where it was almost working without me, but not quite. So I, I promoted one of the team to a GM position and gave her the opportunity to, I guess run and, and grow the business on her own and be there as more of a coach, mentor guide, uh, while I set up creating this other business, which at the time I've called five Star Reviews, cuz I figured that's kind of what it does on the team is I help people get reviews. But it's so much more than that. It's all about the client journey experience. Cause if I can teach you how to do that, you'll get a, an amazing five-star good review. So, but I can tell you now, it wasn't easy. Uh, you know, stepping away from a business that you really spend the best part of a quarter of a century running, um, is tough. Uh, and one of the first things I had to do is actually physically relocate myself to another office away from the Diamond Store so that, you know, giving them the space to run the business in their own space. And, you know, pretty much it, it, it took a year, it took a good solid year of stepping back and, and, and allowing the rest of the team to rise. And, you know, even as I think I shared this with you, the other, the other day, even as just little as just last week, they, their team came to me and I normally only work Saturdays at this point, but they said, you know what, you don't even need to come in on Saturdays now. So that was, uh, you know, that brought up all these other feelings of guilt of not even being there. But, uh, but I, I'm getting used to having two consecutive days off. I haven't had two con consecutive days off for a very long time. So, uh, so I've really enjoyed watching that business grow in a way now that just runs completely autonomously without me. And there's a lot more that obviously we can dig into that. Um, but now focusing on this new business and growing and helping people be found, Be seen and be chosen on Google just based on their reviews and, and their reputation.

The emotions around letting go of control

Steve Sandor 13:28

Uh, set it up beautifully Karl. Um, there's a couple of things I'd like to, uh, we, I'd love to come back to the customer journey and experience and creating that, you know, that exceptional. I want to come back if I can, to the, particularly the emotions that you had as you were letting go of control. Um, and you know, I, when I work with my clients, I'm saying, you know, people say you should let go of control. And I go, uh, that's not really the, I don't, I think you might be misunderstanding it. You need to be in control. You probably not, probably you need to be less controlling. So I'd love to dig into how you actually created that environment for you and your staff to trust each other. Yep. But I'd just like to back up, if I could, sort of going back to, you came from a, an entrepreneurial fa family that had a business. The natural thing is, you know, um, uh, Xennox Schwantes and Sons. So what was the, what was the conversation in the family that sort of directed you to doing a science degree and then directed you into the Army? And, and then how did that sort of morph into you coming and taking over the business?

Karl Schwantes 14:58

Mm-hmm. Great, great question, Steve. So, I mean, I guess I was, even though I was doing other things, I was always still in the business. You know, it wasn't, it wasn't kind of like I did that over there and then, and these two things were separate, I guess I was always used to multitasking and doing three different things at, at a time. Um, the, the love of the military came, uh, when I was at school. I was in like army cadets and I, and I enjoyed, I enjoyed that, uh, and, and, and the, the idea of giving back to my country was something that was important to me. Um, Growing up, I mean, any, anyone, again, who's worked in a family business, I think as, as you kind of alluded to, like it's never all smooth sailing. You've got your ups and your downs and you know, your best way to work with each other, uh, to achieve an ultimate result. And I think what happened was, at, at some point I had that, that, that, that point where I was either gonna go off and do something on a more permanent basis, or I could take over the family business. And, and I think my, my parents were probably in their sixties, late fifties, sixties, I think at that time. Um, and so that was, that was, uh, an opportunity for them to kind of begin their next chapter. My mom's an amazing sculptor, so she does that as kind of a more of a hobby. And my dad loves, uh, traveling and doing things with property. You know, he would say that if you asked him that since he's retired, he's never been busier, which I always find like a really funny, a funny comment. But, um, so I was al it was more of a case that I was doing multiple things. And I think, you know, for me, uh, I've actually got four children. My wife and I have four children. We've actually got triplet, 16 year olds and an 18 year old. So for those of you who are trying to do the mental maths, uh, that was four under two, uh, that we had. So, uh, I've got three kids in year 12, so it's still tough. Um, but I look at my kids now and I go, do any one of them want to take over the family business, be the third generation? And I think at some point as a parent, you would much rather they do something that they love and that they enjoy. And if it, sometimes it means if they've gotta go away for a couple of years and find their feeds and get grounded and then come back, I think that's always a better option. So, uh, I think my parents were always very supportive of me, uh, kind of experiencing and exploring other options. And ultimately, as I said, I think it made, makes me a, a better person, uh, better business owner, better entrepreneur, a better thinker in the way that I approach things. So the sum of our life experiences really form who we are. So, I think that, uh, I went away and, and did that. I don't think it was ever a, I don't think it was ever a case in the early years, oh, this is, you are gonna be the, the next generation. It wasn't, it wasn't that. It was just something that I was good at doing, uh, and I enjoyed doing. And then I think when I came back from doing, uh, the science degree, I think that's when it re, when I finished the science degree was really when it accelerated because, uh, from there I went and did my diploma in Gemology. So I became a, a qualified gemologist. I became a qualified, uh, diamond grader, did my jewelry valuers, uh, qualifications. And so that was really, now that I think about it, that was really the turning point, finishing the science degree and then, and then off I, off I went.

Steve Sandor 18:08

That's really interesting. I, I, there's a lot of family businesses who struggle with that whole, the son daughter taking over the challenges that they have. Because there is, you know, you only got this job because you are the son of or daughter of

Understand every aspect of the business

Steve Sandor 18:29

Yeah. You know, you haven't earned your stripes there yet.

Karl Schwantes 18:32

That was, that was, that was something that was really important to me. I, I, I wanted to be like, if I was, if I was gonna be in this business, I, and, and again, again, that's so aligned with how I am in the Army. You know, it was, if I'm gonna be in this, I wanna be the one in charge. I want to be, uh, respected for my qualifications and experience and, and, and that side of things. I mean, uh, since then, you know, I've won two national design awards for designing jewelry. Um, so there is that, that building of, of that reputation there. But I wanted to really, I wasn't content just with being a salesperson, so to speak. I wanted to, to really grow and develop myself, you know, in how I.

Steve Sandor 19:08

So there's a, there's a difference between being a technician or you know, a good at a particular craft. Yes. Um, and running a business, and we all know that running a business is completely different set of skills. So you can be a really good. Jeweler, but run a really rubbish business. Mm-hmm. And the transition, I'm really interested to know the transition that you had with your father when he made the decision. He said, okay, I'm, I'm heading to the retirement. Yep. What, what was, what was that conversation? How long did that take? What did you, what were the steps that you did to ensure that that was a success? And what were the, we all talk about our successes, but what were the things that, like you just went, I get where you go, holy shit, why did we do that? Right. So I'd, you know, drill down and, and because you learn from those mistakes, right?

Karl Schwantes 20:00

A hundred percent. Yeah. You know, the funniest thing is, I, I think when you, like, one of my favorite sayings is the era of the old is to mistake, uh, experience for education. And the era of the youth is to mistake education for experience. And the reality is it's somewhere in the middle. Right? So, And it's something that I didn't really fully appreciate until I started to transition outta the business myself. And I don't think you can, unless you've actually been through it. But, you know, I really understood when I've heard other people talk about it, it's almost like a death. It, it's like you, you are letting go of this part of yourself in some ways, um, and you're allowing someone else to take it on for, for another generation. Uh, and I di I don't think I fully un understood or really appreciated what that would've been like for, for, for my, for my father. I was just a very ambitious, you know, mid twenties, you know, young family was wanting to take over the world. Uh, and uh, you know, like there was a lot of heated conversation. I mean, my background is German, Greek, and Italian. I mean, if you, if you can't think, there was some very spirited conversations around that. Wow. So, um, that, that's hilarious. Yeah. Yeah. So my mum's side is Greek and Italian and my dad's side's full German. Wow. So, you know, it was, uh, there was a lot of passionate sort of things, but I, I think the credit to my dad was, he was also at the, at the point of his life where he realized that this wasn't what he was gonna do for the next 10, 20 years himself. And he had in me somebody that was, uh, technically very capable, uh, had done a lot of things, you know, to really establish himself in, in that side of things. And so, going back to what you were saying about the technician, uh, one of the things I prided myself in the business was understanding everybody's job intimately. The administration side, the craftman side, the the buying side, the marketing side. I, I understood every single, and, and, you know, from a leadership point of view, I mean, they sometimes talk about that as cross-functional leadership. You know, it's like you understand everybody's job. You don't need to sit in that role or operate that. Uh, and so for me, sitting on a bench for eight hours a day focusing on a piece of jewelry this far from my face, uh, you become so immersed in it that you can't run a business. And, and that's oftentimes where a lot of jewelers go wrong, is that there might be amazing craftsmen, but you can't run a business that way. So, but I think there came a point where, where it got to a point where, like I said, it was either a case of, uh, we, we, we work out how we transition this now for me to take over and you to step back. Uh, or it could be a case of I was gonna go out and set up my own business and do my own thing. And so I think my dad really saw that at the point just saying, well, uh, I've gotta learn to loosen the grip on, on the reins. And, uh, and so we talked through a couple of different options. You know, there was a, there was an op no one. Okay, so first myth to bust here. No one ever gets handed a jewelry store. Okay? So no one, you know, that doesn't happen. Uh, so there was, cuz for us in the jewelry industry, stock is like your retirement po that's your superannuation, you know, over 10, 20, 30 years, you build up all the stock and, and you have it. So, um, I was only right and fair to kind of, uh, to do that. And then we just had to manage, well what did that look like? Uh, and what I ended up doing was basically just going to the bank and saying, I need to borrow a truck letter of money, put up my house and, and did everything. And then, you know, bought the business, uh, from my dad. Uh, and my, look, my dad was still there. Uh, look, it was probably a little bit tense in the beginning. Like I said, I, I didn't fully probably appreciate from his perspective what it would be, what it would feel like. And if I could go back in time, I'd probably, I'd probably have a little bit more compassion and understanding for what that must have been like for him, um, going through that process. You know, having a business for whatever he did was at the time, 20 something plus years. Um, and just to know that you're not going there every day. So, but, uh, but everything's great now. He often comes into the shop, uh, if he needs to sit down on one of the benches and, and, you know, do something for a little private job that he's doing, he comes in and does that, you know, so it's, uh, I think time is, is, is, you know, they often say that the first generation sets it up sometimes that the second generation can either stuff it up or, or take it up. And I think for him there, I think there is on some level, uh, probably a level of pride that it hasn't and hasn't stuffed up, but it's, it's still going and it's going well. Ha.

Steve Sandor 24:23

Have you had the opportunity to talk to him about, um, about that, about that transition and whether there was. You know, maybe you were a little, a little, um, hard on that transition because you, you had put the risk, you, you know, you'd taken the risk. Now you, you were the one holding the Yeah. The mortgage documents and, and the stock. Right. He, he was out of that. Yeah. Um, which is different to, in some instance, sometimes when there's like vendor finance and you know, you, you own the business, but you don't really yet because you haven't bought it from me. So I, I guess you had the right to be like that because you were taking the risk. But I still understand that now in hindsight, you go, well, my, I could have done differently. Have you had a chance to talk to him about

Karl Schwantes 25:13

Yeah, look, we have, I mean, to put into context, it's, it was over 20 years ago that it happened. So, you know, there, there's been a lot of water under the bridge and, uh, you know, we, we, we have spoken about it. Um, and, but I don't, I just don't think it actually comes up really much anymore. He's, he's genuinely sometimes interested to see what's happening and, and how, how the business has changed. And obviously businesses change, not just in terms of economy, but technology and, and things that are happening today with, you know, computer assisted design. So, you know, he's somewhat interested in, in, you know, how that that all works. But I think sometimes we als also looked back in time through rose cu color glasses and we remember the good times, but we don't remember some of the bad ones, you know, so, uh, so he loves still looking back and sometimes we reminisce about it through the rose colored glasses about how lovely it was in doing this. Um, but yeah, so everything's good now. The whole family, you know, works really well together. And if, if, if they ever need anything, they always come back to me to, to kind of help them out with the, any of the jury needs.

Steve Sandor 26:16

So you are

Would you have started a new business if it wasn't for Covid

Steve Sandor 26:17

now going. At a relatively younger age. Right? Yeah. So if I, if I understand it correctly, the reason your father was happy to sell the business was because he was approaching that retirement age? Yes. And so there wasn't anything like, no health

Karl Schwantes 26:33

issues or No, there was no, no, there was no, no health issues. It was just a

Steve Sandor 26:37

natural, okay, I'm gonna sell the business. My son is interested in it. I'd rather sell it to him than, than my competitor. Great. Okay. So he's, he's got some legacy Yep. That he's invested in you now, uh, in this situation where your, because of Covid, what I'm interested in is if it hadn't have been for Covid, do you think that that transition or stepping away from the business, whether you would've even considered that at this stage of your life?

Karl Schwantes 27:17

Yeah, that's a great question. I mean, uh, I, I've, uh, I have thought about that, uh, for a long time. So, you know, over the last, whatever it is, 10 years, you know, I've, I've done a lot of things being a, a Telstra business finalist. Um, you know, they've even invited me to come back to be one of their judges. Uh, I'd been helping, I've been, I'd done loads of, of professional and personal development from Anthony Robbins to, you know, all, all the different ones. And for a long time I'd been helping people in my communities and networks with their businesses in one capacity or another, but, but ultimately just doing it for free. Um, and people have been saying to me a long time, you, you should be charging for this. And, and so it had been pre covid, it had been on my. To do something in the coaching and mentoring space. Not particularly five star reviews. Um, but it was always in the later, I'll do it someday, kind of bucket. And what Covid did was really just drag me kicking and screaming to that decision a lot faster. So I think it was always gonna happen. Would it, would it have happened at this point? Would it have happened maybe when I turned 50? Maybe in five years? Probably. Uh, who knows? Um, it was always going to happen, but what it did was just accelerate my timings.

Steve Sandor 28:29

Yeah. And that happens often, isn't it? That, that it's, I'd like to be out of the day-to-day operations of the business, but there's no reason for me to do that because everything's comfortably uncomfortable now. And it's, it's not until unfortunately, you know, either relationships goes bad or a, or, or a, um, you know, health issues, or you just get to that point where you go, I'm I'm, I'm over this now. Um, so. In some ways Covid was a blessing, blessing in disguise.

Karl Schwantes 29:01

I know, I know. I, I still haven't got to the point where I really look back and think what, you know, lump, uh, fondly on that yet. But it, but yes. Well, maybe in 20 years time you look back. Yeah. Couple times. Yeah. Yeah.

Steve Sandor 29:13

So, so let's move into, you know, the, the day-to-day operations of Karl Schwantes. So you've got this. Mm-hmm. Okay. We've, we're having to deal with the business in Covid. So what are we going to do? You've, you've done the research, you've gone up Google. Wonderful. Um,

What did you do to set up the business so it didn't rely on you

Steve Sandor 29:34

but before Covid and the experiences that you were, um, offering your, your customers, right? Yes. And then now you are going, okay, I, I need to hand over the reins to somebody. During that period, what were some of the things that you put in place that the listener could, you know, potentially use as a part of their process, a part of their journey to extract themselves from the day-to-day operations of the business?

Karl Schwantes 30:08

I, I think there's a lot of things that, that we did, uh, I'll try and touch on as many as I can. Number one is around culture. Uh, and one of the things that I, I'm a very big believer in personal profe. I mean, I've got a library at Xennox that are books that I just buy. I read and, you know, I, there was one point where I was like, geez, I wish everybody did this. Like, if they could understand how beneficial it would be for them, you know, professionally and personally, everybody should do it. And whether it's a book or a podcast, doesn't matter. Uh, like, and so, but I was asking people to do it and no one was doing it. And so I said, okay, bugger this. I said, uh, we're gonna do it in my. So we started, you know, we started in the morning at whatever, eight o'clock, and I said, for the first 15 minutes, you're gonna take a book from the library and we're gonna sit together as a group and we're gonna read. And then for the,

Steve Sandor 30:55

I love that idea. That is such a good, it's such a simple, it's a such a simple thing, isn't it?

Karl Schwantes 31:02

Yeah. That's brilliant. So for 15 minutes, we would read as a team, then we'd spend the next five minutes sharing what we learned from, from the book so that, you know, vicariously through each other, we could all learn. And then we would talk about how we would apply that in the business. And then the next five minutes we would talk through like the core values. So what are our core values around the team, you know, uh, working for the greater good and all that sort of stuff. Um, and then we would talk about what was the, the on for the day, like what did you have planned, what was coming up? And so, so building in kind of simple discipline of a daily standup huddle creates the kind of the solid foundation by which, you know, it makes it very easy for people to kind of really be, uh, grounded to know, well where, where are we going? You know, so I, I would say, I would say the culture getting really cl and there's a lot, so much more you can unpack about how to, how we did the culture side of things. But, but it was just more that daily, one of the biggest things I find with business owners is that we feel like, because we've told the team something once, that they, they got it, it's okay. And, and the reality is, is that we all need daily indoctrination. It, it's that constant hearing of the message about the values, the culture, uh, what we stand for, and all of that sort of stuff makes a big difference for how people show up.

Steve Sandor 32:18

Right. I don't know how many times I've actually said that, cuz I grew up in a, you know, in a world where, as an electrician, when I first came outta school, we had toolbox meetings every day. Right. The leading hand would tell us what we're doing. Now, it wasn't cultural based, it was more about, um, you know, activity, what we were doing. But that's always been, that's always, I've found it useful and I've always applied it whenever I've been in that situation. And I dunno how many times I tell people, like, you know, they got a problem. I go, well, are you, you know, do you, do you have your huddle every day? No. Well start a huddle and I get the rolling of the eyes, right? Yeah. Woow going on a tangent. Why, why would we do that? Um, but I lo I'd, I'd love that. And I will, I'd love to dig into the cultural, how you, you know, what was the culture that you'd built, but I love that concept of, uh, collective accountability. Um, where you, you together, it's not you as the employer having to create an environment that is safe and culturally, you know, um, positive for your employees, but you're doing it together. I love that. That is, that is gold or diamond. Yeah. I dunno, whichever one you wanna put.

Karl Schwantes 33:36

It's a gem. So, um, so that, I mean, that was one of the, the many things, um, you know, in, in the beginning, in that early transitioning, like I was, I was setting up the new business while working from inside Xennox and it just became evident that, you know, as business owners, you know, you, you've generally been in the business longer than anyone else, you're probably better and more competent at most of the key roles than most people. Um, and what you realize it's like having a star inside a, like a defined space, is that it often creates a shadow and it makes it very hard for people to step out and shine. And so the, the first, one of the first things I did was to relocate. It was in the same building, just on a different floor, but literally just took out a small little office, you know, whatever it was, 10 square meters, whatever it is. Uh, and just relocated some of my operations out so that I wasn't in there all the time. So that, I think that was a really, that was also the second key. So making sure you got the foundations and the, the huddles and the routines, and then relocating yourself out. And then what I did was, was by promoting somebody that was internal, you know, somebody that had worked for me that, uh, for like, I think at the time she'd been working with me for about seven, maybe seven or eight years. So good. A good deal of time. So we were very much aligned from a, like a culture and, and everything perspective on how the business should be run. But you know, like anything, you know, the, it's sometimes I talk about it like a. You know, sometimes the pendulum swings too far to the right and then sometimes it goes too far to the left. Um, and you know, how do you get the balance right between when you're mentoring somebody to, you know, being there for them, uh, when they need you, but not being too much, that it becomes too much for them. And what we found through some ups and downs was what we would do is, uh, once a week we would have a business catch up, uh, where it was all about the, the p and l, it was about the sales, it was about the numbers and whatnot. And then we would do a personal catch up, which was just coffees to say, how's the kids going? Whatever it is. And I think sometimes people lose sight of the human touchpoint element. And I think both of them are really important to really fostering that sort of, uh, relationship between potentially the, the business owner and potentially the operator.

Steve Sandor 35:57

Yeah. Again, so much in line for me. It's a, and what you are, um, what you are demonstrating here is an interest in the individual and the person, so some care in their, um, in their, not just their personal life, but interest in their professional life. And I always found that when you, uh, had those conversations that you built up a certain amount of trust and within that relationship so that you could have a difficult conversation when the difficult conversation needed to be had. Yep. And then that enabled that the person knew that you weren't attacking them. Mm. It was just the situation that had been raised and that you weren't happy. Cuz I'm, I'm, I'm sure there were times when Oh yeah, you know, the decision was made and you go, I don't believe you just did that. How is that possible after all of this? Right? Because I've been in that situation. You just go shake your head and you go, how? Um, but it's because you've had that. So I, I, I love, yeah. Again, there's so many nuggets of gold in this conversation, so thank you. Thank you so much for that. Was there anything else that you, that you put in place that helped you to extract yourself? So, I, I love that the fact that you've relocated Yeah. Get yourself out of there. So you, they can't come looking for you. Right? I'm not, I'm not available. So solve it yourself, and then if you can't solve it, then come and ask me. Was there anything?

Karl Schwantes 37:43

I think, I think one of the, well, I think one of the big things, and this was something actually that was really implemented a lot by the gm, was really around those, those pathways of communication. Like who re, who asks who, if you've got a problem, who do you ask? And you're not jumping across, you know, teaming or, you know, the, the jewelers had to go to somebody. The, the people in, in the sales had to go to somebody. And, and I think then it gets really clear as to who your direct reports are and things like that. So I think that was also a really important, uh, factor in just making sure that people felt comfortable, that they understood who was who in the zoo and, uh, and where they needed to go if they needed help with support and

Steve Sandor 38:22

some clarity around a, around roles and, yep. Responsibilities, role chart, that sort of stuff. Yep. Fantastic. You personally, what was, what were the emotions that you were having as you started to extract yourself? So there's, you've, you've obviously got, you know, the connection with the existing business Yep. And, and that emotional connection. And then you've got the new business mm-hmm. That you're trying to establish and you've got emotions around that, you know, fear and excitement. Yes. Um, you know, fear and excitement are the same emotion, just the context is different. Right. So how did you manage that personally to be able to, to, to make that, and who did you lean on to help you with that?

Karl Schwantes 39:05

Uh, like I said, I think for me, I was always used to like doing multiple things at any time. So, um, you know, the all kind of spinning plates kind of thing, you know, it, it's, I, I don't, I dunno whether I, I really struggled having the two different ones. It was just something, because again, I wasn't there, there was a point where, okay, so it started off where I would work. I think it was two to three days a week at Xennox a and then we sc as we employed new team to replace me. It was kind of a case of, well, I'll just work Saturdays. And, and the working Saturdays, uh, was there for about a year and a half, I would say a year and a half to two years. And, and more of that was just because I just love doing it. I love helping clients. I love doing the drawings, I love doing all of that sort of stuff. Um, and so I think, I think it was the, the biggest one was when they said, you don't even need to come in at all. That was probably the more kind of thing. It's like that feeling of you wake up on Saturday and you're ready to put on your three piece suit and go in and you go, actually, you know what, I don't need to go in today. You know? So that was, uh, I'm, I'm still not sure whether I fully adjusted to that just yet, but, uh, but I think it will come and I, and I think it's, I think it's a good thing. And, and you know, I think as business owners we sometimes wrestle with this idea of. You know, can anyone do it as well as we can? And if they can't, you know, well, I'm losing money. And I remember, I remember having a conversation. I, I've been very fortunate enough to spend a couple of weeks with Richard Branson at his home, uh, in Necar Island and also in Africa. And, you know, one of the things he said to me once is that if you can find someone that can do it, 80% as well as you, the 20% that you lose will be more than compensated by the free time and other things that you're able to do. So I always try and remember that as being something that I'm, I'm really like, what does it open me up to do now? Now it could be something to do with the kids now it could be focusing on my work or, or the stuff to do with the five stars. So, um, I'm completely at peace, peace with it. In fact, I might actually come to the point now instead of wearing the I work hard badge, uh, of honor, it's now the badge of honor that I have a business that only, uh, that I don't need to work in. You know, that's, that's, it's, it's been a really quite interesting mental shift for me. Mm-hmm. Mm-hmm.

Steve Sandor 41:20

The envy of most people, but they don't necessarily want it, or, you know, they'd like to have it, but they just haven't bumped to that

What are the metrics you use to measure performance

Steve Sandor 41:29

mental state yet. I, I'm really interested to know, cuz we talked about know, business owners need to be in control of their business, but not less controlling. So what are the, what are some of the metrics that you focus on now? Because it's still your business, you still own it, you're still paying the wages, it's just the general manager runs it. So, so what have you put in place to Yeah. Enable?

Karl Schwantes 41:50

So, so in, in, in, in the shop, out the back, you know, there's a big, uh, whiteboard that has everybody's stats and everything on it. Uh, for the sales team and everything they track on. And, uh, the, the gm, her, her, her stats that we run through aren't run on np. So net profit as opposed to gross profit, you know, because cuz gross profit, the sales team can control and the jewelers and, you know, wastage and all that sort of stuff. Um, but net profit, there'll be things that they can't control. Things like printing, stationary, rent and all that sort of stuff. But the, the GM's responsible for reporting to me net profit. Uh, and we kind of go through the PNLs and, and, and look at those things on, on a regular basis to go, you know, how are we running, you know, is like, is this necessary? Can we cut this? Do we need that to make sure that it's, as the business is running as profitably, as POS possible. Um, and, and that's reflected in things like gross margins and, and you know, and she's very well, and, and across all of that. So it makes it very easy to have that conversation. Will, okay, what, which lever do we need to pull a little

What is 5 Star Review and how can it help the listener

Karl Schwantes 42:50

bit? Fantastic.

Steve Sandor 42:53

So let's get onto the good stuff, which is what you're doing now. Yeah. So, so tell me about, uh, I, and I know a little bit about what you do, but tell the listener about the, the customer journey experience Yeah. That you had, and then how you've actually monetized that. Yeah.

Karl Schwantes 43:10

So I guess essentially what I do is I run, uh, coaching consultancy, online training, um, to do, and that's the, that's the wonder. I mean, if you really do look at it as a blessing in disguise, COVID has really made everyone so much more comfortable with Zoom and, and things like that. So, um, What I, what I feel very aligned with, you know, and again, this is, this is a military, uh, principle, which is being an integrity and, uh, what nothing grinds my gears more than somebody who, who's a keyboard warrior that's looked up something and tried to create a course around it that has no practical experience in it. So for me, it's like, this is what I do in my diamond business, and I'm sharing the secrets, the frameworks, the techniques, the scripting, everything that I would do in my business for you, in your business. So for me, there's a, there's a strong alignment, uh, with that and being able to share. I, I think also you get to a point in your, in your business, In your career where it really is about giving back. And you the, you know, in the beginning you make the, the joy and the thrill comes from the, the sale. You know, I sold, you know, a piece of jewelry with this much or whatever. And I think as you get older, the joy comes in seeing the, the, the, the spark light up in someone's eyes when they finally get it. And they, or, you know, my clients message me all the time with snapshots of the reviews that their clients have gotten or this or that. And, and I have that kind of proud parent moment where, you know, that is my joy is seeing the success in others. So for me it's, it's, it's, it kind of ticks my boxes on a, on a whole number of different things. You know, really elevating. I'm, I'm on a bit of a mission to elevate the client journey experience because unfortunately I think so many people do it quite poorly. Uh, and in the beginning when I started this program and it's teaching was I would just teach people how to do the, get the Google reviews. It'd be like, here's the script, here's the system, the process, the automation. Here's what you need to. And then I realized, oh, you know, they weren't getting either great reviews or, um, or as many as they needed. And I thought, well, okay, well I've gotta go upstream. And some of the things that I guess I took for granted, I had to kind of start unpacking and going and, and there was a process of about six months where I really just sat down. And as much as I coach and mentor other people, I'm a strong believer in having coaches and mentors who mentor me. So I've got two or three of them, uh, that mentor me in different things. And one of them, I just sat down and he was all about extracting the ip. Why? Like I'm looking at your little, uh, you know, your chart there in the top corner, uh, you know, helping me unpack why it is that I do what I do and how I do it, and how can I teach that to other people to, to replicate it. Uh, and that was, that was really exciting, that process of discovery and, and doing that. Uh, and, but ultimately the proof comes in the pudding, you know, and, and the clients that I have that I help, that get amazing results from, from doing it.

Steve Sandor 46:00

So just to give the listeners some perspective on this, uh, um, and, and where this applies, because I'm a dinosaur when it comes to, to this. In fact, the funny thing is, I was on a group call the other day with someone who talks about in a Google reviews. Yep. I, and I had never claimed my, my right. And, and, and I'm going, oh, oh, maybe I should do that. Yep. Um, because I've always, you know, coaching for me is more about the personal relationships, but I get that if you're not being found, there's no point. Right. You can have as many,

Karl Schwantes 46:45

but they say, there's the old, the old joke is where, where do you hide a dead body? It's on the second page of Google. Cause nobody, nobody is searching there. Yeah. Yeah.

Steve Sandor 46:54

Um, so, uh, uh, maybe just a, a couple of use cases Yeah. Where, uh, you know, the, the, the transition.

Karl Schwantes 47:01

Yeah. So here's, here's a really interesting stat for you. Uh, they did a big research, uh, a little while ago and they found that only 2% of people online have never looked at a Google Review or looked at a review. That means 98% of people are, and sometimes I think we, we, we get stuck in looking at our businesses through our own lens and just saying, well, I wouldn't do that. Well, you are not the client. You know, it's really about, well, what is the, what is the buying behavior? What is the searching behavior of your clients? And the reality is that most people are looking at reviews, whether it's on Google, whether it's Trustpilot or Yelp. Doesn't, doesn't really matter. But one of my clients that I took through this process, she was a vet and, uh, out at Ripley. So that's halfway between Brisbane and Ipswich. And, uh, She using the frameworks and the systems and the processes I taught her to do, she generated about a hundred and twenty six five star Google reviews in six weeks. Um, the impact that, that had on her business over 12 months was that she had, uh, increased her top line, uh, revenue by, uh, I think it was about 32%, um, her profit by 20%. And she had to imply 30, 30% more staff to keep up with the demand. Mm-hmm. But what was interesting for me was that she said that not only were, um, they were busier, but she said that, that the, the space in which people came, like people, when you go to a vet, normally people usually drive within a five or 10 k. Radi, who's the local vet? That's who I'm gonna go to. What she found was, is that using this reputation marketing strategy, uh, she had people driving 30 kilometers, passing six other vets to get to her because of her Google reviews. And I thought, isn't that interesting? It was a case of not just about getting a bigger piece of the pie, it was a case of how can I grow the pie?

Steve Sandor 48:51

That's really interesting, um, that, that the choices that people make are based on other people's experiences.

Karl Schwantes 49:01

It's crazy. Like 93% of people trust an online review as much as a recommendation from a family or friend. Wow. That's crazy. Then you don't even know these people. Wow. But that's what, that's what people do. Mm-hmm. And, and, and why, why is it that they do it? Okay, well, when we look at it, um, Google knows, Google knows so much about us. It's crazy. They know where you are, where you spend, how long you stay there. Uh, but Google at this point in time, can't see where your. They can't see, you know, they're not, well, not that we know of. They're not listening to everything we're doing, although they probably are. Um, they, uh, they relying on, on consumers to provide the algorithm with the data it needs to provide the best search result. The reason that Google is the number one search platform is that when you type in who is the best chiropractor in Brisbane and it comes up with the number one position, you go, that's where I want to go. Um, that's the how Google makes its money with ads and so forth. So the better it can predict who you want, what you want, when you need it, uh, the more you stay on the platform and the more money it makes. But they need us to put that data in. So that's where Google is, is providing so much, uh, prominence and presence in Google when it comes to the review. So like when you type in like dentist Brisbane, you know, at the top you'll see the ads who most people skip past. Then below that, you see all the, the top three, uh, local search, which has your Google Reviews phone number, website. And then below that is all of the organic, organic, and organic is what most people focus on. But you can jump ahead of all of that by focusing on your reviews and your profile.

Steve Sandor 50:40

You know, what I love about this is a, and it's a criticism I have of my industry. You know, the, the management, consulting and coaching industry is that we are very good at the theory, but we've actually never done it. You know, so the, you know, one of the things that I claim is that I've actually managed businesses with 20, 30, 100 staff, and I've actually created culture in the business that enables me to go and play golf for, you know, three days a week now, albeit, you know, working for someone in a paid, uh, employment, um, not as a consultant, right? What I love about your story is that you actually know how to apply it. The knowledge that you've gained is not this, you know, I always joke about, you know, how do you make money on the internet? You teach people how to make money on the internet, right? So there's actually no substance behind it. You, if you are so good at it, why are you still doing what you were doing? Right? Other than the fact that, you know, you're, you're, one of the reasons that you are doing it is that, you know, giving back. And again, I love that. So again, you know, I, it resonates so much with what I think the listener, um, uh, would love to hear. So thank you

What is the 10,000 smiles campaign

Steve Sandor 52:05

very much for that. The, the, the one thing I wanted to talk about was that you launched this 10,000 Smiles campaign. What's, what's that?

Karl Schwantes 52:13

So I, I think as business owners and entre entrepreneurs, uh, we are really in business for three reasons. The first reason is, is that we wanna make money, uh, cuz otherwise, like why would you do all the stress hassle and, and every day when you can just go work for somebody else. Uh, the second thing is that we have a genuine love of delivering value to our clients. You know, so if you're a baker, you love making bread and you love the fact that people, you know, enjoy your bread. But I think that there's a third reason. And the, and the third reason is, is that we wanna make a bigger impact on the planet. And so for me, what I do, and I do this in the diamond business as well as the five star business. So in the diamond business, we make a donation from every ring that we sell to the Starlight Foundation. Um, because, you know, I believe that kids and, and women are really important, uh, things to contribute to. So for me, I thought, well, what if, you know, every time I helped you get a Google review, I thought, what happens to your client's face? Your client smiles, right? And I thought, wouldn't it be really cool if the smile didn't end there? What if, what if we could make that smile happen here, make it happen somewhere else in the world? And so what we, what we decided to do is that when we are working with a client, every time they get, every time we help them get a Google review, uh, we donate one day of education to a young woman in the Philippines to help pull themselves and their family out of poverty. And there's so much research out there that says that if you look after the women in a community, they look after the parents, the siblings, the, the husband, the partner, whatever. Uh, you know, they, they just do so much. And so I thought, wouldn't that be really cool? 10,000 Google reviews, uh, 10,000 days of education and 10,000 smiles. And so we're, we're, we're over a thousand. Uh, smiles on the way in. Uh, and and so that's what, and it's, and it's growing each month. So, uh, and we do that through our partnership with B one G one. I dunno whether you've heard of B one G one. Yep. But they're a great, uh, organization. If you haven't, uh, seen them or heard of them, check them out. But they, they really just make sure that whatever you donate, a hundred percent of that goes to the, to the end user.

Steve Sandor 54:27

That's fantastic. Um, yeah, making an impact is part of it's purpose, isn't it? I mean, you know, you have to have this purpose in life, so that's, that's fantastic.

Karl's contact details

Steve Sandor 54:38

Um, it's, I'm just looking at the clock. Um, we can talk for, we can talk out, we, we, we, we could keep going. We'd probably have to come back and, and do it all again. We'll do a, we'll do a part two. Yes. Yeah. Um, Karl, if, if people resonated with, Your story. If they wanted to look at doing some improvement on their Google reviews, how would they get in contact with you?

Karl Schwantes 55:02

I probably think LinkedIn is probably the best way to reach out to me, uh, purely because we're just going through a rebranding phase. So five star reviews is what we called it in the, in the beginning. Uh, the potential name shift of where we're going to is reputable. So, so I would say at this point in time, just reach out to me on LinkedIn. Uh, that's the easiest way. So it's just my name, Karl Schwantes. Uh, you can see some of the stuff that we are doing there, but that's probably the best way. Or at this point in time, Karl, k a r l, at my m y, the number five star reviews.com au.

Steve Sandor 55:31

Beautiful. We'll make sure all of that is in the show notes, um, and, um, and in our, all our promo material. So thank you very

Karl's Offer to do a Complimentary Google Review

Steve Sandor 55:40

much for that. Um, I, if. Believe that, uh, anyone who rings up and mentions this podcast that you're quite happy to, happy to do a complimentary audit for them?

Karl Schwantes 55:53

Yeah, so what we do, what I do is I do a Google Business profile audit. Um, that profile alone is worth 36% of your seo and most business owners are barely touching it. So what I'll do is I'll do a specialized, if you mention this podcast, I'll do a specialized loom recording for you, just doing a really, uh, detailed overview of your platform, of your profile, and give you at least three to five things that you could do to improve that platform and to start generating more website traffic, like immediately just by optimizing that profile.

Steve Sandor 56:22

Fantastic. I'll be your first customer done. Karl, thank you so much. Really do appreciate it. It was a fantastic conversation, uh, and I know the listener will get a lot of value from it.

Karl Schwantes 56:35

Thanks, Steve. It's been, uh, awesome being on the show and I look forward to part two.

Steve Sandor 56:40

well, I hope you got some value from that conversation with Carl. I know I did. We were so much on the same page. Uh, really loved his story about how he was able to develop a culture within the business that enabled him to extract himself from the day-to-day operations of the business. It's exactly what I'm talking about with my clients that, Hey, you can create. Uh, S put systems and processes in place that will enabled you to be in control, but less controlling. And, and be able to do the things that you love to do, or in Karl's case, pursue other passions of his and create another business that is making an impact. In the world. So I really, uh, thank you very much for listening to this episode of the inspiring business podcast and as always, I hope to inspire and energize you. So you too can make a difference in your and others' lives.