I have found that the biggest concerns of small business owners are Sales / Revenues. Cash Flow, Team and Support, Time, and Risk Management. These are all issues I help small business owners and solo-preneurs more in-depth within my CFO Money Mastery programs, but I’m sharing just a few tips to assist you with generating revenues, increasing your cash flows, and focusing your time and effort.
- Pay yourself FIRST
When was the last time you looked at how much your business is paying you (or you’re paying yourself), compared to what you’d like to be paid (or at least need to be paid to cover your cost of living)? Pay yourself and your business first – build up a cash reserve policy and practice so that you can deal with repairs/replacements when they arise. Here are some things to look at:
- Try putting at least 10% of every dollar you bring in into a savings or special purpose account. If you feel you can’t do 10% right away, try 5%, something, anything, that is automatically put away each month/week into a separate account that earns more money (interest, dividends, capital gains). You’ll see how quickly that account starts to grow and how much you can accumulate in a relatively short amount of time.
- Know what you’re paying yourself for your time, and what you would like to get paid for your time. The simple formula for finding what you’re paying yourself in your business is to take your revenues, less all your expenses, divided by the number of hours you spend in your business. What is that? What percentage of revenues is this, is it what you’d like to receive?
- Review at your pricing strategies – this ties into paying yourself. Make sure that your pricing strategies include paying you for your time and effort. Understand what products and services are most profitable, or which ones could be more profitable. Review your profit margins and give yourself a raise.
2. Streamline your profit model You’ve all heard, jack of all trades, master of none? While it’s good to have some diversification, when you have so many offers that are not streamlined with each other, you could be spreading yourself thin trying to market all of them. But, when you start with your top end offer, and have everything else streamlined to that offer, your attention and efforts are more focused and aligned with selling the top end product. But how do you streamline when you have so many great ideas coming to you? There certainly are ways to do this, and I offer a half day session on brainstorming ideas and putting them into streamlined offers, but here are a few key questions when you find yourself coming up with a ton of ideas and wanting to serve them all:
- Is it even for you to create and run with? Or should it be passed on to someone else? This happens to me – I get a ton of ideas, but realize that some of them are not for me and will end up having a conversation with someone who I’m supposed to pass the idea on to.
- Is it asking to be created/offered right now, or later? If later – park it in your idea book and review it later. If it’s asking to be created now, through you, run with it.
- Is it aligned with the bigger picture for your business? Is it something that can be added to what you’re already offering – as a bonus or as a side dish that you charge for?
If you have a ton of offers, but seem to be spinning your wheels trying to generate revenues with all of them, try focusing on just 3 things that give you the most profits and cash flow, at least for 90 days. You’ll see with more focused attention and marketing/selling efforts, your revenues may actually increase.
3. Track your money daily! Why daily? It allows you to spot trends in your revenues and sales numbers so you know what your numbers are telling you. That way you can take corrective and inspired action right away to create more flow and hit or exceed your bold money targets. In my experience, in the months I don’t track what’s coming in daily, I have less revenues than the months I do track what’s coming in daily. Tracking my money daily (which takes less than 5 minutes a day) gives me focus to do what I need to do to have more coming in, to hit and even exceed my bold money goals. It IS best practice (and good management) to keep your bookkeeping up to date and review your financials at least monthly. Managers at large corporations review financial data almost daily (even hourly in some cases) to allow them to spot trends and take action to align their efforts to their targets. As a small business owner, key metrics that you’ll want to look at are sales and profitability, cash in bank accounts, cash tied up in AR, amounts coming due (AP, Payroll, Taxes) in the next week/month, expense trends (which you can find benchmark data on Statistics Canada (or other similar statistical database for your area) to find out how your metrics stack against other businesses in your industry), and anything that is important/relevant to your particular business that will enable you to make timely and smart money decisions for your business.
What you track, expands. We’ll be going into more depth in these 3 hacks and SO MUCH MORE in the CFO Money Mastery 8 Week Jumpstart program (which kicks off Nov 22nd with a special bonus session). If you would like clarity and assistance with creating more flow in your business, contact me to book a complimentary Business Clarity Breakthrough Session. Or check out one of my upcoming workshops or group programs on the Events page.
[author] [author_image timthumb=’on’][/author_image] [author_info]Linda Spencer is a CPA, CA, Canadian Tax Specialist and Money, Marketing & Soul business coach. Her mission is to eliminate stress and anxiety around money and taxes, by empowering heart-centered small business owners with the tools, knowledge, strategies and mindsets to put them in the driver seat of their financial success and wellness.[/author_info] [/author]