Dentistry Uncensored with Howard Farran
Dentistry Uncensored with Howard Farran
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784 Location Strategy with David James, CPA, CFO : Dentistry Uncensored with Howard Farran

784 Location Strategy with David James, CPA, CFO : Dentistry Uncensored with Howard Farran

7/25/2017 3:02:16 PM   |   Comments: 0   |   Views: 482

784 Location Strategy with David James, CPA, CFO : Dentistry Uncensored with Howard Farran

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784 Location Strategy with David James, CPA, CFO : Dentistry Uncensored with Howard Farran

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VIDEO - DUwHF #784 - David James

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AUDIO - DUwHF #784 - David James

Dave is a Founder & CEO of REALscore with 33 years of executive experience as a CPA, CEO, CFO & Strategic Consultant to companies and individuals. He is an entrepreneur and expert in startups, as well as a dental industry strategic and visionary leader, whose mission is to educate and help Dentists of all ages and specialties achieve success through Location Strategy and to have a direct and significant impact on companies that provide products, services and advice to them.

Howard Farran: It is just a huge honor for me today to be podcast interviewing David James, CPA, founder and CEO of REALscore, with 33 of executive experience as a CPA, CEO, CFO, which is a chief financial officer, and strategic consultant to companies and individuals. He is an entrepreneur and expert in startups as well as a dental industry strategic and visionary leader whose mission is to educate and help dentists of all ages and specialties achieve success through location strategy and have a direct and significant impact on companies that provide product services and advise them.

Every single time I ever meet a dentist who buys a practice I say, "Well did you spend the money and get any demographics in this area?" And he's, "No," and it's like, "Well dude, if demographics don't matter, why didn't you go to North Korea? Why didn't you go to Afghanistan, why didn't you go to the Congo?" My first and only request to you is, do demographics matter?

David James: Oh my gosh, Howard. Well thank you, first of all, thank you, it's an honor to spend time with you and I appreciate the opportunity to chat with you about this stuff because what's fascinating, I got involved in this about, six, seven years ago when I was at my own CFO consulting firm and a friend in the dental industry was ... we were just talking and he was saying how frustrated he was that ... he knew how important it was ... how important it was to find a good location, but there was no tools, no way to go out there to figure out how to get to that. How to get data that actually could make a difference.

The more I looked into this, to answer your question is, there is no more important issue for any dentist than their location. It's the number one factor that's going to determine how successful they're going to be. 

Howard Farran: But it's not true cause I saw the movie, If You Build It, They Will Come. You can build a baseball team in the middle of a cornfield.

David James: Yeah, wow! That's amazing how that translates into a ... and it just depends on, say, with my background ... by the way thank you for that introduction. It's almost like you just made it up all by yourself and you wrote it also perfectly there but ... what I enjoy doing, because of my background and things like that is I realize that the industry was focused so much ... everything I'd see in the industry was focused on dentistry itself and all the things that go in to dentistry and there's a million things out there like that yet, and what really struck me is when I was checking out, you know doing my business planning and due diligence and whether, okay if I build this website, start this business does it make any sense. 

I went to the trade show in Chicago. The big one there. After walking around for three days, I got on the plane and was headed home and realized, "You know what? Everybody in this building, there's 20,000 dentists, there's 25,000 vendors, everything like that and every one of their ultimate success determines on how much volume a dentist does and what drives that is their location and getting into the right place where there's the least amount of competition, where the demographics are the best. Yet there wasn't one person not ... no one was demonstrating in that show to cover location, there wasn't one CE class, there wasn't anything dealing with the business of what I call location strategy. 

I say that kind of in quotes because one of my missions is to try to educate the dental industry, whether it's the dentists themselves or frankly, it's all the other companies, the lenders, the distributors, the marketers, the brokers that serve those dentists, because every one of those companies' success ... how well they succeed depends on how well the dentist does.

Over time, because my job and my ... what I've done for a living is to go through and analyze businesses, help them think strategically, how to grow, how to get smarter, how to do it the right way, is figure out what was really missing from my standpoint, was this whole discussion about location strategy and what that meant. I can talk for four hours on this stuff but the location strategy and the big picture wise, you mentioned the term demographics, okay, in the industry ... when people say demographics in the industry, what I found is that, that's an all-encompassing term for a lot of things but most people when they think demographics, they're thinking, "Okay, household income and population numbers and stuff like that."

What I like to do, is to separate something called the market saturation and the competition from the demographics cause to me, that's a whole other discussion because ... I know you guys have talked about it ad nauseam the ratio of practitioners to population in an area and how much that affects whether you should go into that market and all those kind of things.

What we've done, is we've kind of separated the whole competition market saturation analysis from the demographics analysis because ... look, at a high level I've got a lot of people that say they want to do demographic reports on an area yet if you look at ... we have a process we go through when we help dentists sort of figure out, "Okay, where to best locate my practice."

In my humble opinion, I think that the competition density in terms of the ratio that we're talking about has a little bit higher of importance than the demographics, which is just the basic income, age breakdown, things like that because at a high level, it's like, okay you can have great demographics but if you're going into an area where the ratio is 1,500 to one when we know that 2,000 to one is saturated, then you're gonna struggle. You better have a really strong business plan that covers a lot of marketing and a lot of cash flow and a lot of reduced expectations of what your growth is gonna be because you physically have to compete against so many other people.

On the other hand, if you go somewhere where you know ... and we're finding these all over the country, where ratios are four, five, six thousand to one, and then you find those areas where the demographics make sense. Then you've hit a home run. You're strategically going into an area where you know there is not much competition but yet the demographics all check out. As opposed to doing demographics and then praying that the competition makes sense.

Does that make sense? Do you know what I'm saying there?

Howard Farran: Yes, absolutely. 

David James: That's why ... go ahead.

Howard Farran: What is the dentist population ratio for the whole country of America?

David James: For a general dentist, on average, based upon the studies that we've done ... for the whole country, that's a good question. I don't know exactly what that number is. I could run it but ... it's never been that relevant to me because no dentist is ever going to worry about that. We're looking at what it is gonna be in their specific areas that they want to do.

What I do know, is that it's been accepted in the industry and we've proven that a ratio of 2,000 to one is considered a saturated market. That number can be interpreted a lot of different ways. If you're a startup, then that number tells you that you're going into an area and if you're another dentist in that area then you're going to have to fight to cannibalize patients from somebody else more than likely.

If you're looking to buying a practice in an area where it's 2000 to one, depending upon how the ... your patient breakdown is and stuff like that, that may not be as bad. Half the battle is taking the data and then what we specialize in is knowing how to interpret it and help dentists make good strategic decisions up front rather than having to make a bad decision up front and then spend the next 10, 20 years trying to climb out of it once they buy a building or sign a 10 year lease or something like that.

We're trying to avoid those mistakes before then even happen.

Howard Farran: Yeah, and they come out of dental school 350,000 dollars in debt then how much is your report?

David James: Well we have really ... lets take that scenario. If you're a ... we have a lot of kids coming out of school that want to start a practice but even under that scenario, a lot of times we deal with these associates that have been honing their skills for a few years and then they want to start their own practice.

We have really three main reports. We do a lot of different things but the three main reports that we do are a location search report, where we go through and analyze ... let's say I want to live within ... I want to start a practice within a 45 minute drive time of downtown Phoenix. The location search report, what we do is, we'll take that whole area, that whole drive time area, 45 minutes in every direction and analyze which census blocks within that 45 minute drive time search area has the best ratios.

Let me explain what that process is because this is really important. If there's nothing else that the listeners take from this today, is to understand this concept because when I say census blocks, I always ask people if they understand what that is. Nine times out of ten they have no idea what I'm talking about. This is in contrast to a lot of people that get reports by zip codes.

A zip code, we all know, has very irregular shapes, they're kind of different sizes, different ... they can be massive, they can be small, things like that. When you're looking at a zip code report and you want to say, look at a three mile radius from the center of that zip code or a ten minute drive time because those borders are so weird. If you're just looking at the zip code in that particular spot, you could within two minutes away, you could be at a boundary and have a whole cluster of practices or population things that are in your market but won't show up on a zip code report.

To me, a zip code report is really dangerous. A census block is ... the U.S. census bureau way back when, when they started doing this, they broken the country down into ... don't quote me on this, around 216,000 little individual tiny pieces. In a typical suburban area a census block might be one or two square blocks. It's very, very small chunks of data.

When we go do a ... this concept applies to every report that we do. Cause it's done by census block. Let's say, I want to go do this search in a 45 minute area and what we do then is there's probably, in Phoenix, a couple thousand different census blocks. What we would do is look at every one of those census blocks and for each on we determine ... we pick data for a radius, and a drive time. 

There's strategics reasons for that because it gives us two sets of data. The radius is designed to give an idea what the market for that practice would be within a reasonable distance from ... if you put a practice there. The drive time is designed to approximate what the market for that entire practice would be.

We define that as, okay what's the reasonable distance a new patient, if they didn't know you from anyone, would ... if they saw your ad or saw you online or something like that. How far would they drive if they didn't know you at all. In most places nowadays there's so many dentists out there that most people are not going to want to drive more than 10 or 12 minutes to a dentist anymore because unless they know somebody or ... because it's become more commoditized and stuff like that.

What this location search report does is we analyze all the different census blocks. Every block is analyzed using a three mile radius and a 15 minute drive time. We accumulate all that data and then we provide the top 20 areas within that whole search area that have the highest competition ratios. Then we do something no one else does is we filter that by household income. In other words, lets say someone wants to practice in Phoenix like that but they want to make sure they're in an area where they are which household income is at least 75,000 dollars. 

Not only are we providing them with the areas where's there's the least amount of competition, but where they also know before they even look at demographics that at minimum, the average household is 75,000 dollars. That's huge.

Howard Farran: The average median household income for the whole country is like, 48,000? Is it still?

David James: Right, right. It's like 54, I think I read the other day, it's like 54 something but yeah.

Howard Farran: Is it past 50?

David James: Yeah, it went past 50 I think but ...

Howard Farran: The average house in America is 50 and you're 75, that's a whole [inaudible 00:12:56] tile bump up.

David James: Right, but this is a real game changer, because like I said with that process that we go through to help people find the right location, we're cutting six ... we're cutting months and months and months of just driving around and figuring all that out because within a few days, we can run this report and people are gonna know what are the top 20 areas within their search area that have the best competition ratio and they already know, without looking at all the detailed demographics like age breakdown and all that kind of stuff, they know that at minimum if they're ideal patient is someone that is higher income, they know that that area has 75,000 or higher, and we can make that 60, we can make that 50. We can adjust that to whatever makes sense to that particular area.

That's a extremely powerful report-

Howard Farran: And how much is that report?

David James: It is ... depending upon the distance that you are looking for ... like a thirty minute drive time report is like 749 bucks.

Howard Farran: That was my first comment about me and my student loan deal. They graduate 350,000 dollars in debt and then they won't spend 750 on going in the right place.

David James: Right. This is the absolute ... I mean, if you follow our process, you may pay for a location search report and then you may end up doing what we call a ... then cause the process is basically ... once you identify, a lot of people go out and they fall in love with a location and then they come to us and say, "What are the demographics and competition," and hope that it works out. That only does about five percent of the time. 

The right process is, first of all you identify the big area you'd like to look in. We do this location search report. We come back with the top 20 areas. Then you go through and identify which out of those ... narrow that down to three or four, based upon quality of life, the right kind of schools, do you see yourself living here, things like that. Then you do a deep dive on the demographics. 

Well we do a demographic report that has 19 different variables. We provide data both on the drive radius and drive time like we talked about. We also provide current and five year forecast data all for 199 bucks. It's the best deal in dentistry. In other words-

Howard Farran: So that's the second report. First it's a location search for 749, then a second one is called a what?

David James: It's a comprehensive demographic report.

Howard Farran: And that's a 199?

David James: 199. Yup.

Howard Farran: There's 750 and 200 and ... yeah.

David James: That's before their 15 percent townie perks discount, don't forget to throw that in.

Howard Farran: Thanks for doing that. The reason I like the townie perks is cause the dentist has to wear too many hats so ... I think that their elders should help them make quicker faster decisions on disability insurance, getting a credit card processor, getting demographic ... We're just trying to make it faster, easier, higher quality and low cost.

David James: You got that right.

Howard Farran: Yeah.

David James: Yes. And then third report we do is kind of a hybrid of the two. Let's say somebody says, "Well you know what, I think I've done enough work where I don't need the location search report but I have a ... either a practice I want to do due diligence on or I have an area that I think is gonna work." The third main one is called a practitioner and demographic report where basically it's all the demographics and it's also the ratio data.

Instead of doing the whole location search thing, we'll give them the competition ratios for not just general dentists but all of the specialists and things like that. And again, it's really four sets of data because it's current data, it's five year forecast data and then we do everything like looking at the radius like say a three mile radius to get an idea of what it would be like in close proximity to that office and then a ... usually a 12 to 15 minute drive time to approximate what the entire market would be.

It is ... and the key thing, I cannot emphasize this enough, is by census block, not zip codes. It ignores all geographic boundaries, all those fake boundaries that are out there, mail routes, zip codes, all those things are irrelevant because when someones gonna drive to your office, they're not gonna care if they have to go over a zip code line. Right?

Howard Farran: Right. But I have noticed that demographics can be misleading of you don't pay attention to rivers, freeways, big parks that take a long time to drive around. I am very close to another zip code, but we're separated by a park that goes from 48th street to 51st avenue and for me to bicycle around it takes me three hours and it's 42 miles. Nobody's gonna drive around that ... and freeways and rivers are very psychological. 

I've noticed a lot of people say, "Well I don't want to cross I10." ...

David James: The other side of the tracks. It's literally the other side of the tracks, yeah.

Howard Farran: Do you believe that freeways and rivers affect behavior ...

David James: Yes, oh absolutely. Absolutely. That's the beauty because one of the things ... if I can back up for a second to give everybody how we're doing this, is that ... one of the things I noticed when I was getting into this is that most of the time when you ordered a report, it took two weeks to come, it took forever to get there and you had to identify up front ... you had to pick a spot and hope you guessed right.

What we did, is we developed ... we spent a ton of money to develop this web platform to make it so it's accessible on the internet so we can ... it gives us a ton of flexibility and speed. What we've done is we've combined the best demographic data you can get. The best practitioner database you can get. We've interfaced it with google maps, which sounds easy but it was incredibly difficult but that allows us to do all kinds of different searches like [inaudible 00:18:56] and drive time and one, three, five mile radius and especially user drawn maps where we can actually go on to the screen and draw on the maps and everything.

Howard Farran: [crosstalk 00:19:07] find links to all this at your website

David James: Yes. The key then is that, let's say we have those ... when we're working with ... usually with almost every case, we actually have ... we really believe in customer service so before, most time anybody's ever ordering anything, before they order a location search report, we're actually working with them and figuring out, are there any boundaries like you're talking about that we need to take into account. 

Sometimes we have guys, that if it's close to a state line say, "Well I'm licensed in one state but I'm not the other, so even though that's in the drive time area, carve that out." That's insanely effective because we can give them ... we're not giving them data that's irrelevant. 

This whole I wish I could do a live demo for everybody because it's incredibly valuable because what this allows us to do is lets say one of your sons, lets use Ryan for an example, because he's a nice kid. Let's say he wants to be a dentist and he says, "I want to practice in Arizona but I don't know which city."

I'm not going to sell him a location search report for all those different cities because that would be silly. I don't want to sell him something that he doesn't need. What this allows us to do is do what we're doing now, like an online screen sharing session where we actually, physically go on our website and we start playing and we can pull up competition ratios we can pull up every demographic piece of data. We can use our mouse and draw user maps around specific areas and skip where boundaries are and stuff like that. It's incredibly, incredibly effective. What it does, when you're talking about dentists, with all these student loans and things like that ... we speed up their location search cycle exponentially because we're doing this strategically and we can cut to the chase and get to the right situation. 

Which of course, lenders love that because they get to close the loans faster and everybody loves it because the number one hangup on most cases when you're starting a practice is making the location decision. That could take months and months and months.

Howard Farran: Everybody always is a victim. Everybody's always done wrong and it's like be proactive. You hear all these young kids say, "Well I went and got an associate job and ... I'm not even busy." It's like, dude, you went to an area where there's a dentist for every 500 people, you could have gone out to another area and work through every lunch and stay two hour after work every day.

David James: I am so glad you brought that up because, like I said, everything we do has a strategic purpose to it and I actually wrote an article for Dentaltown about a year ago about this but ... if I'm an associate, and I bet I've talked to a lot of associates and a lot of kids in school and stuff like that. Many of them, they say, "I just want to get an associates job somewhere because I need to get the experience," but my recommendation is do your due diligence on that. You never know, this thing you might take, you might become a partner there, you may find someone you fall in love with and you end up living there. You never know in life what's gonna happen. You knew that as well as I do.

Go into this decision strategically thinking you might be there forever and do exactly what you're talking about here. We've had guys you said, "I want to go be an associate in Charlotte, can you tell me the areas that have the highest potential of practices growing so I know where to search." We can do that in a heartbeat. 

We help dentists ... we help associates that basically say, okay look, I want to ... just like what you're saying. I got two or three different options of where I can go. Spent 200 bucks or whatever and figure out which of these practices have the highest chance of growing. Which ones are in markets that aren't saturated and do exactly what you said. Go somewhere where you're going to be busy, where you're gonna be busy in the foreseeable future, where ... ask your dentist, show me my business plan. 

I would guess that probably 80, 90 percent of the dentists that are out there have been working so hard that your heads down, they're doing their ... taking care of patients and things like that and they do not have a bench mark ... any bench mark data anymore to know what their competition and their demographics is like in their current practice. 

Things change over time. The market changes and things like that and if you don't know where you stand, then you cannot pivot or do what you need to do to grow. That's what from an associates' standpoint is ... take just a little bit of time and make sure where you're going. Let's say why no go somewhere that if it keeps continues to grow and you get offered to buy into it, that it actually has a chance of growing and actually adding equity and value as opposed to what you're saying as going somewhere and twiddling your thumbs.

Howard Farran: I've also seen where a dentist will take a quick job out of school with no long term plan, but end up signing a five mile radius restrictive covenant. Then when he decides to start his own practice realizes that where he wants to be is where he took a job and if he would have known that out of school, he would have taken the job on the other side of town and now he's got a restrictive covenant and the best part of town.

David James: We see it all the time.

Howard Farran: Who's your bread and butter client? You said there ... is it usually kids two, three, four years out of school, they've been working on their craft, they've been doing a lot of fillings, crowns and root canals for three or four years ... is mostly ... is that the kid that's mostly calling you? Who's mostly calling you?

David James: We have so many different types of people calling us that it's kind of hard to rank them but if ... let me talk about a couple of them.

One of them that is very high on the list is exactly what you said. You got an associate, he's been doing this two or three years, he wants to kind of on the sly start checking out his options. He doesn't want ... we help them out a ton because the process that I described earlier allows them very quickly to figure out, number one, okay is the current practice that I'm at worth investing more time in. If it's not, then okay then where are the areas that I want to start, if I want to start either buying or ... starting a practice, the location search that we do is applicable to both because it's gonna point out the pockets where either there's the least amount of competition or the pockets where ... look for a practice that is in those areas so you're not beating your brains out. 

We actually get a lot of dentists that hear from us through some of our partners like you guys especially, Bank of America, places like that where they've been working for a long time, their practice is not growing, it becomes stagnant and they don't know what to do. 

What we're able to help them with is, like I said before, get a baseline of what their current market is and then we can help them decide ... and I know I'm jumping around a little bit but one of the big factors that drives this is peoples whose leases are coming up in the next year or two. I tell all the lenders, all the distributors, everybody I talk to, that if you don't ... and your customer base, if you don't have something in your CRM that says, when their lease is coming up, you're missing the boat because that is a big driver of all these kind of things that I'm talking about.

In that scenario from an existing practice, he needs to decide do I stay, should I invest more money and expand, add more operatories. Does the market support that? Has this practice reached it's maximum cash value, it's not gonna grow anymore or should I sell it now while it's at it's peak or is it a good enough cash cow that I can hire an associate and keep it running and then ... maybe I open up an office four or five miles away. Maybe I move my office. 

Under those scenarios, the only way that you really know whether it makes any sense is if you do the location search study that we talked about because then we can identify ... That's where you're strategically looking at it from a business planning standpoint, not just kind of winging it.

Those probably two are ... those are probably two of the main folks that we deal with. The associate looking for a place to go, either to buy. It's the existing dentist like I talked about before and the third one is really people that are looking to buy a practice and they're realizing, "Hey, you know what? This is a really ... this is probably ..." It just amazes me what the practice brokers and a lot of them that are out there that are ... they talk about all the things that go into looking at a purchase price and I frankly, probably shouldn't get into this but this is dentistry uncensored, right?

Howard Farran: Right. Get into it.

David James: I still don't understand in a lot of ways the ... the ways the dental practices are valued, coming from the outside five, six years ago and looking at it. It's just interesting to me because the biggest factor that should go into a lot of ... one of the biggest factor that should go into the purchase price is the location strategy. What's the competition like, how much to I got to spend on marketing to grow, what's why patient dispersal look like. All those kind of different things that we can tell people without no one else ... but we do it better than anybody else in terms of being able to effectively do that.

For example, we have somebody that's looking to buy a practice and they'll come to us and say, "Well what do you think?" We'll do just that demographic and practitioner to population report and give them the ratio for the area, the demographics for the area, and based upon that, if it's a really, really poor ratio, let's say the ratio is 1,200 to one or even worse than that, then you should be negotiating a cheaper purchase price then what maybe the industry standards would tell you to be because number one, you're gonna have to take ... you need to take that price, that money and invest that in marketing and other things cause there's so much competition that in order to grow you're gonna have to cannibalize patients from other people.

In my humble opinion, if those ratios are really poor, you should be getting a discounted purchase price. Same with if the demographics don't make sense and all that kind of stuff. That's the third category, is people where we're helping them do due diligence on practice purchases and making sure that they know what they're getting in to when they take ownership of it.

Howard Farran: By the way, his twitter, @REALscore_com, at @REALscore_com. I just retweeted, "Check out our most popular report with Comprehensive Demographic and Competition data at an affordable 399 dollar report."

I also, that article you wrote for Dentaltown, it's a new feature we got and it's amazing. When you read an article, there's a share button where you can share it. So I just share it on Facebook, Twitter, LinkedIn, Pinterest, Google +. It's called Planting Your Practice, How to Find the Ideal Spot by David James.

But yeah, when you read your article online ... some of these articles, nothing ... it's like calculus and algebra. Nothings changed since ... or for hundreds of years but ... when you go to your article, you can just share it to your social media and the shares are going up really, really fast since we introduced this deal and the views on these magazine articles are going off the charts cause ... just like the greatest gift a patient can give of their dentist is a referral for [inaudible 00:31:01] 

You read some article and you think, "This is good information," Then reach out there and share it or comment. Cause when you comment on something, it brings it into today's active topics and puts on top page.

David James: That's awesome.

Howard Farran: You're also ... and by the way, I got to tell you my census block story, you were so right in there, I didn't want to interrupt you. 

When I was senior in a ... When I was a junior in dental school, I wrote Phoenix, Arizona and I asked someone for their census bureau information and they sent in from 70, 80 and the 85 mini census' and I was graduating in '87. I got a six foot by four foot map while everybody was working on their three unit PFM bridge, I sent mine to a crown and bridge laboratory and everybody including the instructors knew it and I sat there and traced out the 303 census track, see we didn't have computers back [inaudible 00:31:55] all by hand. We didn't have computers so I had a stack of index cards and I went through and made 303 cards for each one of these deals. 

I think the only reason the instructors didn't say, "Howard, you have to do your bridge, you can't spend all your time doing that," is cause everybody was so fascinated by it and everybody had never thought about it and the only reason I knew about it is cause my dad had to do that when he was looking for his next location for a Sonic Drive-In hamburger store. 

It's just so important and that's why I've been trying to get you on the show for so long. Big fan of your post on Dentaltown too. You're so nice on your posts-

David James: Thank you, Sir.

Howard Farran: And you get so many amazing feedback. All you gotta do is go to Dentaltown and ... I just went on one of them and said, "I'm actually podcasting him right now." But this is just so important. What's also funny is you come from two very under utilized sciences. You're also a CFO. Not only do they not get demographics, they don't know any of their numbers. Even the dentists who think they know their numbers and tell you their numbers, then you go in their office and find out ...

So when you're at the study club and the guy next to you says, "Yeah, I got 50 percent overhead and my labor is 20 percent," What's the chance that he's got the right numbers in his head?

David James: Slim to none.

Howard Farran: Yeah, I mean, do follow up questions. Does that include, FICA matching, does that include labor, uniforms, name tags, sending them a CE. They never know their demographics and then there's also the ethical question about demographics, which is called the Greater Fool Theory because sometimes you're talking to a dentist and you, I got to tell them the truth and say, maybe there's a fool greater than you and you should sell this [inaudible 00:33:41] and move over to the next town and then when you ... I get off the phone, you're wondering, is that even morally right?

The stock market, it's completely right, you see these stock market bubbles. Remember the '94 to March of 2000. You can sell a stock at any price and some idiot would buy it for six years. Do you think a lot of dentists would benefit from the greater fool strategy?

David James: Well you know, yes.

We've spent a lot of time, in terms of how we ... what we do and things like that, making sure that ... at the end of the day, we can't be responsible for the choices that they make. I've been a CPA for 30 some years and a CFO and consultant and what we're trying to do is to guide them ... dentists come out of school with amazing technical skills but you know as well I do that they don't get much business training. 

Different dentists have different advisers whether its an attorney their CPA, their lender, whatever, their distributor, things like that. What we're trying to do for the whole industry, let alone the dentists, as well as those advisors and those companies that help them, is to help them make the best decision possible with the best data possible.

A lot of times, you're right. It comes down to a business decision where they've never looked at their data, they've been heads down on their practice for ten years. They don't realize that the whole market around them has changed until they stop and look at the data. One of the things that we consider really important is we just don't give them a report. We don't email them a report and say, "Good luck, have a great life." 

Everything that we do comes with ... really, we call it a 20 minute call but usually they take about an hour because we like to understand and help them and dig in and understand their situation and understand the data. I don't care how long it takes, we want to make sure they know what they're ... how to interpret it. Cause that's the key. It's the experience and the customer service to help them interpret the data to make the best decision possible.

Getting back to your question, is yes. A lot of times when you look at the practice financials, assuming that they makes sense then you look at the trend, you got to look at what the goals of the dentist are. Is he looking to double in ten years or is he looking to retire in five. Is he on cruise control, all those things kind of factor into it but a lot of times it comes down to it based upon those factors plus the data. You could recommend that hey, this has probably reached its best potential and there's nowhere for it to go but down because and maybe the time is to sell.

Or like I said before, maybe you don't sell it but now's maybe the time to hire an associate and do the study and say, well should I either move it like you said or should I open up a satellite office, where I go and spend a day or two in the main office to keep everything moving and spend two, three days a week in the satellite. All those decisions come into play.

That's probably a long winded answer to your question but I just believe that the data and the intangible factors that go into what lifestyle you want and things like that. All those have to go into play and nowadays I think there are a lot of practices that people would be smart to take a hard look at. Should I sell and move on.

The reason I say that is because we're finding all over the country ... there's a general perception that I hear that all the cities and the suburbs are saturated. You need to go into the rural areas and things like that, which is true, by the way. As a general rule, if you want to grow your practice faster, those are probably the places you can probably go and do that faster. The fallacy of it is, is that we're finding all over the country are there are pockets within 45 minutes to an hour of downtowns of major cities, we're finding pockets where there's three, four, five mile radius areas where those ratios are still three, four, five thousand to one.

You got to have the data to find it and you're not gonna find that with a zip code search. You're not gonna find that with somebody going and looking at an area and doing concentric circle searches and maybe hitting 21 selection sites when there's 1,500 census blocks within that area that could be potential pocket areas.

Do you know what I mean by that?

Howard Farran: Oh yeah.

Also, I've watched it for 30 years. I have dentists that live on the same street as me. My same zip code that travel every day, 40 minutes north, the north, the North Scottsdale where there's 49 dentists on every corner and they're not doing well and then the other one drives 40 minutes south out of town and go down to Florence or Maricopa or Eloy and they're just crushing it.

The guy going out of town is on un-congested freeways, zipping down the street at 75 miles an hour, where the guy driving across town is stopping for traffic. But the other thing that's sad about dentistry is that they come out of school 350, 400,000 dollars in debt, hell, for 200,000, you could get an Ace Hardware franchise and Ace Hardware, have you ever seen three Ace Hardware's on the same corner?

David James: No, because they're smart about where they put their locations.

Howard Farran: And dentists have never done that and the ABA could have done it, the local state dental societies could have done it. Patterson Shine, Benco, [inaudible 00:39:26] I know you work with Benco but ... God, it's so sad because demographics is the most important thing and so my question is you got two boys, I got four, we both got a boy named Zach. Would you rather your kid come out of school 350,000 dollars in student loans or skip eight years of college and buy 100,000 dollar Maaco Auto America's Body Shop and have perfectly spaced competition not to mention national advertising. 

In fact, that's why ... my dad, he used to get so mad at me that I was going to college, he wanted me to drop out of high school and start my own Sonic and his other friends that had lots of Sonics, their kids did and they made bank and he said, "God, by the time you go through eight years of college, you could have five Sonic drive ins," and it's all true but at that time in my life I just couldn't see myself making hot dogs and hamburgers and onion rings. I wanted to work on teeth but ...

David James: Had a higher purpose. Indeed.

Howard Farran: Yeah but you look at the list of these franchises for sale. Take the average student loan debt then say, franchises for that amount of money or less. Gosh darn, you must really, really want to be a dentist because you could have skipped eight years of school and got some amazing franchises. If you really wanted to be a dentist, like I did, and I do and I still love dentistry, you gotta be a business man and you gotta have the demographics and if you think that it's not important then I wish you would just go to Afghanistan for two years in a startup dental office until you realize that maybe demographics matter.

When these kids call you, what percent of them are even open to the idea of rural? Because most people think it's just as bad to go out into the country side as it is to Afghanistan. 

I mean Millennials, they got to have their five dollar chocolate mocha café coffee at Starbucks and their whole grain muffin without genetically modified ...

David James: Right, here's the typical process is that, you're right. A very small percentage of them want to do that. Getting back to your previous point, if you're coming out of school with that amount of debt, why wouldn't you make sure that whatever you do, you have ... you cannot afford to make a mistake on this next step.

The business planning and the strategy and what you call demographics I would ... I like the term location strategy because it encompasses competition demographics, marketing, all those kind of things cause everything eventually gets back to location. 

If I had my way in the industry, I would replace the generic term demographics with location strategy. Back to your example there, what typically happens when we talk to young whether they're out of school or even the pre-year associates and things like that, they'll say, "Yeah, I want to live ... I don't want to drive more than a half an hour and I want to be in the suburbs of a city or ... somewhere where I can be close to the nightlife and stuff like that."

Well, usually what happens is the data doesn't lie. We go through and we do this location search for them and when we show them graphically on maps and things like that, well here's where the top areas are, in terms of the competition and what the household income filter and stuff like that. Here's where you would like to be. So Mr. Dentist, you have a business decision to make. You can go into an area where you want to for your lifestyle and where a ratio is 1,400 to one and explain to them that by doing so you're going to have to spend five times what you might somewhere else in marketing. Your growth is going to be this so the 10, 15 years down the road your practice is probably gonna grow X amount ... a small amount. Or you could go 20 minutes outside of there, open to these areas that are under-served and not have to spend as much money marketing, not have to do all the other things ... you're not having to cannibalize patients. You could spend money doing, attracting them the right way and then ten years down the road your practice is probably gonna be worth three times what it would be if you went into the suburbs.

Now, Mr. Young Guy, what makes sense to you and to their credit, 95 percent of the time they pivot from wanting to be close to town to wanting to go back out and go a little further out or to an area that's under served because they realize, well you know what? If I'm really busy, how many times am I gonna be able to drive down town to do the nightlife anyway. Maybe once in the weekend, it becomes more irrelevant because they realize that when you show them the numbers and you think through location strategy and the business plan, this is ... it's ... they got too much at stake with all the debt, plus they're borrowing half a million to start a practice or buy a practice or something like that. It's time to grow up.

Howard Farran: Yeah, that's another thing that Millennials really got to think about. How many dentists do I know that needed to be close to the ocean because they just loved the ocean. Then you say to them, "How often do you go to the ocean now?" 

David James: That's hilarious.

Howard Farran: Then they say, "One time a year."

Do you know, in my own dental office, half my employees never gone to the Grand Canyon, one time.

David James: That's sad.

Howard Farran: When you go to the Grand Canyon, everyone there is either from Germany or Japan. There's another really tough scenario is they're marrying their classmates in school and mom's from one state and Billy's from another state and how do you ... at being a father of two boys, how do you coach young kids about close to family when family's in two different states?

David James: It's difficult. It just kind of comes down to ... sometimes you've seen this in your kids, sometimes you have to let them make decisions and there may be unintended consequences later but ...

Howard Farran: Well I actually decided not to have any children and my four boys are taking it very hard.

You know what my number one location strategy is, and you're right, I will stop saying demographics and start going to ... you're calling it location strategy.

David James: Yes Sir.

Howard Farran: You know what my number one location strategy is? You're 500,000 dollars in debt, you married a girl in the class, she's 500,000 in debt. So you're a million dollars in debt so number one, leave the country. Just leave the country, go to Australia. Then when you go to Australia, there's no Mexican food.

It's like, there's no Mexican food here. Then you go there, you start a dental office, you have no debt and you open up a Taco Bell or what's that one that you guys always eat at? Chipotle?

David James: Chipotle. Yeah.

Howard Farran: Oh my god, go to Sydney Australia and open up a Chipotle, now you have no debt and Sydney's bigger than Phoenix. You'll probably own 10 Chipotle's. You'll probably buy me a yacht for my 60th birthday. You'll make so much money. 

How much debt do you think they should have, when they should seriously think about leaving the country?

David James: I'm a big believer in no debt.

Howard Farran: Isn't that the fast way to get rid of your debt? Just go to Switzerland?

David James: Just go to Switzerland, yeah. Come find me, boys!

Howard Farran: Yeah, yeah.

David James: My heart breaks for these kids. I don't have enough background to pine of the cost of school and stuff like that, I just know that when they come out of school with that amount of debt and that stuff starts to become payable, that becomes an incredibly high monthly nut to crack and ... That's why our passion, frankly, is to help people in that situation make the right decisions up front but make them with the best data. Make them as quick as they can.


Howard Farran: Here's the difference. 30 years ago, you could come out of school and had so little debt that you could make two or three serious mistakes out of the gate and still be fine. Today, with their debt load, their first three decisions have to be the three best decisions they've ever made. There's no room for error, and you know that. You were a CPA, a CEO, a chief financial officer, have you ever also thought about doing financial ... being a certified financial officer for these dental offices too? Going forward? 

Have you ever thought about going back to your CPA, CFO, CEO roots? Or are you gonna stay with location strategy?

David James: That is an interesting side light that we could ... that I've kicked around expanding into, is taking what I know from my CPA, CFO and strategy site and helping dentists with a comprehensive overview of just life. This is an important part of life but ... you're right, there's so many other decisions that have to made that ... I have kind of kicked that around because I do have a passion for helping young kids and associates, early dentists of all ages, help ... make the right life decisions and ...

I'm a big believer in, and I know there's a lot of stories out there about people who have had hard times and they get on the speaking tours and do things about how they got in trouble how they got themselves out of trouble.

That's great but why not avoid getting in trouble in the first place? That's where I come from, why go down that path in the first place. Let's do the smart things and avoid that and ... I'd go there.

Howard Farran: Since you are so accomplished as a CPA and a CFO, when they're starting their [inaudible 00:49:26] practice, do you really think they can run that on QuickBooks on desktop or on QuickBooks online. That's kind of a serious step down from clicking on desktop, do you agree with that or not really?

David James: I think that-

Howard Farran: I'm giving away my age I'm still on Peachtree and if I told my two bookkeepers that we're gonna switch to QuickBooks Online, they would hit me over the head with a frying pan so hard I would never remember that I asked them that. 

David James: First of all, I think QuickBooks can be okay by itself if you really are really smart and spend a lot of money. The key is, what people don't understand, I don't care if it's dentistry or any industry, you have to design your business system to capture the data you need to run your business or your practice.

That's really like ... knowing what data I need on the back end and then design the systems to do that. You can probably do that reasonably well in QuickBooks but I don't like it. I can't stand QuickBooks Online. It's nice, but it's such ... it's so dumbed down for QuickBooks that it doesn't do any good.

Howard Farran: Well people don't realize when they go public and say, "I love QuickBooks Online," Okay, you just said you don't know anything about accounting.

David James: Yeah. And it's a dumbed down version of QuickBooks from what I've seen. I may be wrong but ... What I'd really like people to do-

Howard Farran: It's the same people who tell people that they have a 95 percent treatment acceptance plan ratio. It's like, really? You have a 95 percent? So no one on Earth has ever had 65 percent and you have 95?

What software do you love then?

David James: I'm just in general, a big believer in the faster you can get on an overall integrated business system, and again, I'm not an expert on the big packages that are out there.

Howard Farran: What do you mean? Say that better.

David James: I don't deal with them every day, like [Dentrics 00:51:31], and those kind of big business systems and that kind of thing. But I can tell you in other industries that I've worked in, and the concepts are the same, is that there's a cost benefit ratio you have to take into account. 

For the most part, investing in the right business system that's integrated that gives you efficiencies that integrates not just financial information but customer data. All the other aspects into that, it may be more money up front, but it's gonna save you a ton more down the road because you can have the flexibility and get what you need in order to manage your business.

QuickBooks is gonna be nice for kind of the nuts and bolts but it's not an integrated business system that if you're ... it's very difficult in QuickBooks to get statistics on, okay how am I ... if I break my types of services down into different segments, how do I analyze how profitable each of my segments of my business are? It's really difficult to do that whereas in some of the more advanced practices software.

If you set them up correctly, and that's the key, is the design up front and understanding what ... how you want to analyze your business. Then you design the accounting and the business systems to accommodate that.

Howard Farran: I think you're talking over their head. I think you're talking over there because what you really said was, that the big ones, [Dentrics 00:53:02] the Eaglesoft, they're not integrated management systems with accounting like you see in every franchise known to man from Chipotle to Hyatt, to Hilton, right?

David James: Let me be clear, I've never used [Dentrics 00:53:18] or any of those, so I can't speak to that specifically. I'm assuming that they have financial stuff integrated with them, don't they?

Howard Farran: It's not linked to any accounting firm.

David James: It's not linked to any accounting. Okay, learned something new today. If that's the case, then that is ... we need to start our own company and fix that.

Howard Farran: Yeah, you're basically, it's basically Stevie Wonders at the wheel.

David James: That's insane. I don't know why I've never heard that before but that's unbelievable and there's no other industry I know of that will have an operational package out there that's not integrated.

Howard Farran: Well you'll only find it in two industries routinely. Healthcare and government.

David James: That's true. You're right.

Howard Farran: You'll never find it in another industry. Food, agriculture, tires, cars, kitchen sinks, it's special to demonstrate. 

David James: I'm dumbfounded, I did not know that.

Howard Farran: What accounting do you use for your business? What accounting package? Do you like Microsoft's ... Microsoft back in the day bought Great Plains accounting but they renamed it Microsoft Dynamics GP [inaudible 00:54:19] for Great Plains. It's an accounting package and an enterprise resource planning. Did you ever try that? What do you use in your office?

David James: I worked at a place like that. We're small enough that QuickBooks works fine for us because ...

Howard Farran: So you're a CPA and you use QuickBooks Desktop.

David James: Yeah.

Howard Farran: Okay.

David James: Because I know enough about how I can manipulate that to get the data in terms of how REALscore is doing and the different reports, the different markets we serve. I can get that out of there okay. Most dentist's office and most people don't have the same kind of ability and background that I do. They struggle with that. 

Unless you're a practice that has a lot of different locations and have the volume to support a big enterprise type system like that, probably dynamics and things like that ... the cost of that is probably gonna be overkill given the benefit from it.

That's an interesting question, I'll have to think about that a little further.

Howard Farran: You know it's tough cause the only reason you went to dental school for eight years cause you want to help people. You decided you wanted to be a surgeon we only work in operatories, we work with our hands. We're doing surgery, we're getting you out of pain, we're fixing you up, that's the love of it. That's only 51 percent of it. 49 percent of it is HR and accounting and marketing and website design and SEO and motivating and leading your team and your staff and that's the part ... and a lot of them always complain that ... well they didn't teach that in dental school. Well they didn't teach you your politics in dental school, your religion, your eating habits, it's dental school. You were supposed to learn that somewhere else.

The greatest letter I've ever got back, when I came out back in the day, I think it was 1998, I came out with a 30 day dental NBA, it was 31 hour VCR tapes. Do you even own a VCR?

David James: I still have a VCR DVD combo that I bought four, five years ago to take all my kids videos and copy them on to DVD.

Howard Farran: That's so funny, we just did that. We just sent all of our pictures to a company who put it all on a JPEG then we bought a big screen in the front room and every ... it's on a slide show and ... because you got to my mom's house and entire walls are just covered with millions of pictures and it just looked a little more organized.

Anyway, my sister, my oldest one, was a catholic nun and this priest was complaining about running the parish and this stuff and he said, "I went to seminary school for eight years and all we did was study the Bible and then I graduate and they put me in this small town. I'm in front of a school, it's nearly bankrupt, their teachers are all upset. The parents are crazy. Why didn't they teach me any of that in eight years of seminary school?"

My sister calls me up and she says, "Can I have a copy of your tapes? Maybe there's not that much difference between root canals and running a church in a school." That preacher wrote me a letter, said that was the greatest thing that ever happened to him because it was the only 30 hours of training he ever got in his entire life and there's no difference between the priesthood, a lawyer, a physician, a dentist, these kids come out and they all [inaudible 00:57:37] on the 51 percent of their art that they're not even remotely trained.

Then a lot of people will complain that they're working at corporate and they'll say, "Well I don't like this corporate," well what do you not like about it? They say, well you know I want these 1900 burs to one occlusal filling and they'll only give me three burs.

I'm like, "Okay, well that ... I get that. That's a negative. Do you think you might be able to learn something working in a dental office that has 52 locations?" Do you think there's something other than focusing on your-

David James: Pay attention, yeah.

Howard Farran: ... low selection of burs. Can you be downloading all their Microsoft forms and their HR policies and their dress codes and their marketing and maybe you should work at corporate for two years and get your dental NBA by saying, "This guy, the owner who I can't stand, is running 25 successful dental offices," and then all the dentists running one dental office, are struggling. Maybe there's something you're gonna learn from that chain that has 50 locations, let alone 500 or 1,500.

David James: Yeah, that's what I've told the associates when they're looking for a place to go. Yeah, you're going because you need to get better and faster at your craft to make it scalable. You come out of school, you know how to do it, but haven't learned the tricks about how to do it better and faster so you can get more procedures done. At the same time, you're also ... I love your 51, 49 percent quote, that's awesome because ... pay attention. Learn how he handles people, how he handles dispute resolution. Negotiations, marketing, all those kind of things because that's what's really gonna make or break you when you decide to go off on your own. 

Learn that on his dime and opposed to having to struggle and do that yourself. That is an awesome point, Howard.

Howard Farran: I'm trying to think, I only got you for five more minutes, I can't believe this was the fastest hour ever. Actually it went over, it's at 101 minutes. That was so fast. I just want to tell you this. I wish you'd get your friends on Dentaltown to go to your articles and every time they comment on them it takes you today's [inaudible 00:59:56] topic. Share it to your social media because I love my homies, I get it. I'd rather pull four wisdom teeth than take my four boys to Disney Land. I love it.

That's why I'm a dentist. I didn't want to be making a number one, a number two, a number three and a number four, I made a thousand of them in grammar school and another several thousand in high school. I get that. They have to make this right decision and you don't see any franchises that put 47 McDonald's on one corner but if you go to 450 Sutter Street, in downtown San Francisco, there's a building with several hundred dentists in one building, I'm like, have you ever seen several hundred Long Johns Silvers in one building?

David James: Yeah, it just defies logic.

Howard Farran: They're like, "Well, but it's a professional building." 

What does that even mean? It's an old ... It's actually a very old ugly building. It's a hundred year old building. If that's professional someone needs to get a wrecker ball and knock it over. They say they want to be in a professional building. They say they want to be ... they have all these cultural, mythological beliefs and they need math, they need data, they need a location strategy.

I am your biggest fan, I'll do anything to help you get your magic on, spread the word. Thanks for being on the townie perks. Thanks for coming on the show. Thanks for writing articles but you homies out there listening to this, you need to read those articles and share it to all your dental school classmates, all your friends working at Aspen and [Hartland 01:01:31] and all these people like that and gosh darn it, if you get a A in demographics is that a game changer?

David James: It's unbelievable. If you get this question right, the location strategy question right, there's certain decisions in life where you got a fork in the road that will make a major impact. This is one of them because getting the location right is not only ... it's basically gonna affect your legacy. [crosstalk 01:01:59] it's gonna affect your family, it's gonna affect everything that you do down the road and ...

Howard Farran: And that's what frustrates me about my homies because they got A's in physics and calculus. Usually the dentist is the only one in the neighborhood that knows the difference between geometry and trigonometry. These guys can knock it out of the park, they just ... someone just needs to take their head and lead the horse to water and say, "You don't need a A in biochem, you need a A in demographics, you need an A in accounting."

David James: The key here, is we're not talking about the talking about the young kids, we're using them as examples but the point I want to make is I don't care if you're 65 and have a dental practice or 70 or 40 or whatever. Wherever you are in your life cycle and your practice life cycle, location strategy, if you haven't looked at that in a long time or even in the last year or two, then it's time to look at it because you need to have a strategy. Whether it's an exit strategy for your current practice, or a growth strategy to expand or whatever. Whether it's due diligence or anything.

Howard Farran: Here's our next move, here's what we're gonna do. The Townie Perks isn't on the app, I just realized that. The next version of the app is coming out in a couple of weeks. We're gonna have the classifieds. We need to add the Townie Perks because there's a quarter million dentists on dental town but 50,000 have downloaded the apps. Guess  which one downloaded the app? The Millennials. Guess who's on the desktop? All the guys with liver spots, like me.

David James: Right, right, right.

Howard Farran: We need to ... you need to email me, Lori, and our head programmer's Ken. So Ken at Dentaltown, Howard at Dental town. I think ... does Lori at Dentaltown work? Or does she ... Lori at ... Okay, so Ken, Howard and Lori at Dentaltown. We need to add that Townie Perks section but if you put a bunch of money into your development on that Townie Perks, you should be able to click that on the app and they should see some kind of demo. You know kind of deconstruct the cells for us. Instead of just going from REALscore, to seeing the report, give the medium something away for free. Something so they'll get a better ...

They know the kreb cycle, dude. They know how many ATP come out of glucose if you give them enough away for free, once they see it, they'll get it.

David James: Yeah, and that's true.

Howard Farran: The Millennials are on the apps so let's get the Townie Perks on the app and let's get some type of demo from you on the app and on the desktop so that when you go to Townie Perks instead of clicking that and seeing the static REALscore, the menu stuff, there should be a YouTube video ...

David James: Boring, boring, boring.

Howard Farran: ... there should be some video of you with your magic of showing them, this is what a location strategy means.

David James: Okay, I love that.

Howard Farran: The best ever deconstructed [inaudible 01:04:49] for us, you know these [inaudible 01:04:54] will put a full page ad in Dentaltown and they'll think the dentist is gonna read that and that'll translate into them flying across the country and dropping four grand on a weekend course. The biggest thing you'll own is your home, and on an annuity, it's one of the best decisions you can ever do if you're grandma, I mean, why give all your money to your kids when you could have a nicer lifestyle and ... but you can't explain that on a 60 second commercial.

The whole commercial is just to get you to get the DVD and the whole purpose of the DVD is just to get you to call them and give them your address so they can tell you what the payment ... it's the biggest decision to make so they deconstruct the [inaudible 01:05:32], first stair, second stair, third stair I think we need to get the Townie Perks on the Dentaltown app and it needs to go from a static page to something video where you give away something for free. Maybe a Surge or something because I know my homies are so smart if they just saw a [inaudible 01:05:53] something they'll get it. They'll get it.

If they get it cause they can't at 350,000 dollars in debt, they can't make three bad decisions in a row.

David James: And the beauty ... I fully support that because I gotta give these Millennials, they get a bad rap sometimes but I give them a ton of credit, a hundred percent of the time, when we spend a little time with them and explaining what location strategy is and the fork in the road that they're at and the impact of the decision that they're making, they made wonderful choices but there's education that needs to happen so that they know that not only how important it is but where they could get resources to help them make the decision on it.

That's where I think what you're doing, I'm really glad you didn't become a Sonic guy because the legacy ... well the legacy you're leaving with this and the body of knowledge that you're helping to create and everything like that ... I just can't ... it just amazes me. I'm not trying to suck up or blow smoke up your rear. This is just amazing what you're doing in terms of being able to help people and help your homies as you call them and ... so thanks for all that you're doing.

Howard Farran: Just remember one thing. I still make the meanest onion rings on this side of the equator. You peel them, you make them cold, you cut them you put them on ice water and then you put them on flour and then the flour, the trick is, then you put them in ice cream milk then you put them in ... what's that stuff called, the grain of the ... the cracker meal. Then you let them dry out until they're completely dry. Then you make sure the oil is 350 degrees and you test it by just putting a little drop of water in there and it's gotta explode out of there. Then you sink those things, man I can still ... I can't tell ...from each 10. You know how we made ... that's how we made them back then. It wasn't flash fried [inaudible 01:07:44]

When I was ten years old, there was no frozen french fry, that wouldn't come along in the McDonald, that came from Idaho, what was that guys name? J.R. [Simplot 01:07:55] That was years down the road. Me and my five sisters, we probably peeled a gazillion pounds of potatoes and onions. That's all we did, from age 10, 11, 12, 13, 14 just back there making french fries and onion rings.

David James: My first job at your age was going ... was riding my bike an hour away to a run down building where a guy ... he had 15 incubators in there, but my job was washing goose eggs.

Howard Farran: Are you serious?

David James: I am serious. When I was 12 years old, that was my first job.

Howard Farran: What state?

David James: Indiana. Northeast Indiana.

Howard Farran: Indiana, raises geese for goose eggs?

David James: Back in 1972 there was a guy that did.

Howard Farran: Wow, that is amazing.

So you used to be a Hoosier.

David James: Yeah, absolutely.

Howard Farran: They know what, they finally just discovered what a Hoosier was. Did you know?

David James: I'm not gonna repeat it, y'all like to tell it.

Howard Farran: It's not even a joke, it was on NPR. Back in the day when they were building railroads, they used to build them five miles a day. So when the whole crew comes to your town, you wouldn't stop and say, "Well I'm David, and this is Howard, and this is my son, Zach." You would just say, "I'm one of," if you worked for Hoosier, "I'm one of Hoosier's men," and this lady, who is sitting there, writing the history of the railroad business and she absolutely proved and found a man named Hoosier that lead a railroad all the way across Indiana and the norm would have been as you were blowing through their town five miles a day, "I'm one of Hoosiers guys."

David James: I've never heard that.

Howard Farran: That was on NPR.

David James: ... said that way before.

Howard Farran: It was NPR and they said it was just the common culture that your name would be one of your bosses men because you're never gonna see this guy again.

David James: That's amazing. No, I ... I lived in Indiana until I was 35 and then I've been in Ohio for 20 years. [crosstalk 01:09:50]

Howard Farran: Well you're working towards Phoenix so you'll be here eventually.

David James: We'd love to get out there, I'm telling you. I'd love to do that. You got a lot of great stuff.

Howard Farran: Let's work together more on the things we talked about, about getting the Townie Perks on the app and getting a more ... a better explanation of what location strategy is just because so we can tip these kids into making better, faster, higher quality, lower cost decisions.

David James: Sounds good, Sir. I appreciate it.

Howard Farran: Alright buddy, have a rocking hot day!

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