Most business owners I know are stuck in the “sales cycle of doom” meaning that they are constantly having to market, sell and deliver their services just to get by. Rarely do I see successful small businesses producing any level of profit.
For every £1 you bring into the business you will have:
By the time you deduct all of those it means your £1 is probably worth more like £0.50 or even less in many cases.
Therefore every saving of £1 you can create in your business means you have to bring in £2-3 less in revenue on the top line. Which means you need FEWER clients. Not more.
This is a more sustainable business.
Imagine a coaching business which has a group coaching programme which it sells for £4,500 per seat.
And that coaching practice has several subscription softwares which it pays for every month. If that coaching business can cut it’s subscription costs by just £200/mth, when you extrapolate that out over the course of a year, £2,400.
Based on the maths of £1 saved leads to £2 less in required revenue this means that coach can afford to NOT HAVE TO enrol one additional client that year. £200 doesn’t sound like a lot, however the effort required to enrol a coaching client might require:
So, you can see, a saving of just one client per year frees up at least 17 measurable hours for that coach, consultant or freelancer and countless amounts of energy in marketing.
* as a side note, you may be looking at that thinking a 20% conversion rate is low for a business coach. Not if they’re qualifying prospects and only taking on the best clients. 20% is a typical conversion rate for a coaching business.
Yes…and no…if you’ve listened to other episodes of the Fearless Business Podcast you’ll have heard me talk about Marketing Assets. If you build marketing assets such as:
To name just four assets, you can create these assets and they will start conversations for you while you sleep.
When you’re next tempted to buy a “shiny” marketing thing for $5k from a hipster bro-marketer who wows you with “guaranteed” results…think twice.
Most people miscalculate the ROI required for that investment to make sense, and think they just need to recover a single client (if they’re worth $5k to you) to make an ROI.
You will need at least 2-3 clients just to BREAK EVEN and probably more like 8-10 clients over the following year to justify the investment. As generally these investments become rolling payments that you need to make month in and month out irrespective of the results. They will also blame you should they not produce the results they promised you.
That’s a podcast episode for another day.
The moral of the story is:
Keep your costs low and your income high.
Join our amazing community of Coaches, Consultants and Freelancers on Facebook:
And check out my personal business coaching website.
If you're a small business owner, you know that good financial health is key to running a successful company. Business owners who don't think about finances and plan for the future can find themselves in trouble when unexpected costs arise or opportunities come along.
The next step is to think about how you can use the money you're saving. If all goes according to plan and your business succeeds, what will be your next step? Will it be hiring more employees? Investing in new equipment or technology? Or expanding into new markets?
Whatever it is that helps grow your business, saving money will help make those dreams a reality.
In order to grow your business, it's important that you save money. There are many ways to do this:
If you're a small business owner, it's important to save money. Saving money is one of the best ways to avoid taking on debt and getting yourself into trouble with creditors.
You should avoid taking on any type of debt if at all possible. If you have to borrow money, make sure that whatever you're borrowing it for is going to improve your business and help get it off the ground--not just provide some extra cash for things like vacations or expensive dinners out with friends. You also shouldn't take out loans unless there's no other way for you get what you need without putting yourself at risk financially (like when starting up a new business).
As a small business owner, it's important to save money so you can be financially healthy in the future. You might want to use your savings for any number of things:
Saving money can improve your business's financial health by putting off debt, investing in the business and being ready for future needs and opportunities.
If you're running a small business, there may be times when it's tempting to take out a loan or use credit cards to pay for things that would otherwise require cash on hand. But saving money is important because it allows you to avoid taking on debt and gives you more flexibility with how much cash flow goes toward expenses versus other things like investments or emergencies that might arise down the road.
Having some savings also makes sense from an investment perspective; if something comes up unexpectedly--like having to fix an expensive piece of equipment at the last minute--having some extra cash on hand could help prevent having to shut down operations due to lack of resources (or worse). Even if nothing bad happens during this time period, having some extra funds available gives owners peace of mind knowing they have options available should something unexpected occur during those months when they may not have been able to save anything at all
Savings are an important part of any small business. By saving money for your business, you're able to make smart decisions about how it grows, invests and prepares for the future. Saving money also helps you avoid debt so that you can focus on building a strong foundation instead of worrying about paying off loans every month.
People who read this article, also enjoyed reading: