The Secret Sauce For Affording The Business You Want
Do you feel like your business is stuck on a financial merry-go-round?
You want to invest and grow, but you don’t have the funds to invest and grow until you make more money. It is a maddening cycle!
You go round and round with very little progress.
Chances are, you're working all the hours, doing all the hustling, and feel like you've little to show for it.
Luckily, you don’t have to get stuck on that merry-go-round. I can show you how to hop off before you start to feel queasy!
Today I am sharing the secret sauce to breaking the cycle and creating a profitable business that operates in the way you want to work.
Now, this concept is something I share with my clients. It's actually one of the first steps that we go through when we are creating our profitable pricing.
And here it is, it's called... "Your Future Facing Business Budget."
Say what now?
Let’s jump in and find out exactly what your Future Facing Business Budget is and how you can use it to create the kind of business you love to run.
What Is A Future Facing Business Budget?
Your future facing business budget is a simple concept. It is where you build a budget for the business that you want to have, not necessarily the business you have today.
See, part of the challenge of looking at the year ahead and understanding what you can afford is getting stuck in the here and now. We often focus only on all those expenses and investments that we currently have.
And we just make a plan for more of the same.
What that means is, we're never actually making a plan for all those extra investments that we want to afford but currently can’t - those investments that will enable our business to evolve and grow.
So we stay stuck feeling like we can’t afford them.
And yet, the investments you feel like you can’t afford are often the ones that can really help your business either scale quicker or make your life better!
So what can you do?
Breaking The Cycle
How do you break the cycle of feeling like you can’t afford all the investments that help you grow, until you’ve already grown??
Well, there are four simple steps to follow. And here they are:
Step #1 - Plan
I want you to have a think about the year ahead. Think about how you want to be living and how you want to be working.
I know you went into business to earn an income from the thing you love to do. I also know that you are probably working far too many hours trying to make your business a profitable success.
Somehow, running a business has become associated with constant hustling. The expectation is that if you aren’t working 18 hours a day, then you simply aren’t dedicated enough.
I say that’s rubbish! It is possible to run a business that doesn’t run your life.
So, in this planning phase, consider how you want your life to look in the coming year.
How many days do you want to be working?
How many hours will you be working on those days?
What activities would you love to outsource?
Write it all down.
Step #2 - Prep
The next step is to think about all the tools and resources you want or need to create your ideal business. All of those things you need to make doing your job easier.
The tools that would help you create the lifestyle and the business that you want to have.
It could be anything from adding a VA into the mix or a piece of smart automation software that removes time consuming manual tasks. You may even need a new laptop or specialised equipment.
Once you have them in your head, list them all down.
A small word of caution: try not to think too big at this stage. We are working to build a business that will grow year on year, so just consider the things you will need in the next 12 months. You can factor other tools and resources into your Year 2 or Year 3 budget.
Step #3 - Budget
Now, I want you to put some numbers around the tools and resources you listed in step 2. It is important to assign a figure to each. Even if you don't know exactly how much each component costs, put a ballpark figure in there because we know it’s not going to be free!
I find it easiest to put the numbers into a spreadsheet which can become your future facing business budget document.
List all the costs you know you are going to encounter in your business, along with the tools and resources you want to implement in the coming year. Don’t forget to factor in a portion of the funds to pay yourself.
Once you have entered all of the expected costs, you will have a budget for the year ahead. A budget that actually includes all of those investments you need to move your business forward.
Step #4 - Price
Simply having a future facing budget is not going to magically create extra revenue in your business!
You will need to factor the expected costs into your pricing, so that you generate enough revenue to cover them.
Armed with your budget document, have a look at your current pricing and where it needs to be to generate enough revenue to cover the costs.
When doing this, don’t forget about the work you did in step 1. That’s code for, don’t budget to work 18 hours a day to generate the revenue you need if you only want to work 6 hours a day!
The End Result
What is all of this work for?
Well, it is all about being able to afford the business that you want to have. When you understand your costs and are generating the right amount of revenue, you've got enough money in your bank account to actually afford those investments that you previously had to say no to.
This is the secret sauce to creating a profitable business that works the way you want to work.
Your future-facing business budget allows you to plan for the business you want to have, not just the business you have today.
Pricing your products and services correctly is a huge part of building a successful business. But, it is one of the things we business owners struggle with the most.
Often, we set our pricing based on guesswork or what others in our industry are charging. There is no thought given to the business you want to build. So, if you are ready to build a successful business that you love to work in, then I can help you do it.
Reach out to me today and I will help get you started, because you my friend, are worth it.