Time to Get the Ball Rolling Towards Higher Profits in Your Small Business
Time to Increase Your Small Business’s Profits
In today’s episode: We discuss getting the ball rolling on your working the 8 Steps to $100,000 in profits. Each day we will dive in deeper to help you put your gameplan together. Today we focus on the first two steps and the roll of taxes in your equation.
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Episode 92: Time to Get the Ball Rolling Towards Higher Profits in Your Small Business
Welcome back to the Local Small Business Coach Podcast. I am your coach, Tammy Adams.
Today we are going to take a look at the steps you need to take to work your way to $100,000 in profits
Hey everyone, I can’t believe we are already at episode 92. In a couple of weeks, I will hit 100 episodes. How crazy is that? When I started this journey 7 months ago I worried that I wouldn’t have enough material to make it to 50 episodes, never mind 100. But thanks to you I have a bunch of ideas to at least get us to 150. 😊 This is one reason it is so important that you continue to reach out with your suggestions or questions.
As we head into the home stretch of the 100th episode, I wanted to expand a little more on the steps for you getting your business to $100,000 in profit. As you know, I put together the free eBook – 8 Steps to $100,000 in Profit for Your Local Small Business
And so far, the feedback has been very positive. On a few of the steps, I have been asked if I could give even more examples of some sales ideas, how to create more profits, which processes you should work on first, etc. So, I decided to take each step and brainstorm with you on some possible ideas to get your juices going.
Here is what I’m going to do. On our way to episode 100, I’m going to dedicate each episode to diving in deeper into these key areas that impact every type of small business owner. Obviously with heavy emphasis on the local small business owner.
WHAT YOU CAN EXPECT
Now, here is how this episode is going to work. Since I have already broken down the first couple of steps is past episodes, I’m going to just touch on them here and then explain the role of Taxes in this whole 8 Step process. Then in our next episode, we are going to brainstorm together a butt load of sales ideas. Then next week we will dive into a bunch of ways to increase your profits with what you are already doing, plus another episode on where to look for easy wins on your costs and expenses, followed by an episode talking about the processes you will want to dive into that are costing your profit.
RECAP OUT 8 STEPS
If you are new to the show, then you might not know what I’m talking about. Basically, I feel every local small business owner has the ability to take home in profit $100,000. As many of you know, sadly, the average local small business owner only makes between $35,000 and $50,000. So, I broke down the 8 Steps you need to take to get your business to this 100k level. If you want to learn more I go over this in both episode 4 and episode 83 . Plus, over at localsmallbusinesscoach.com/8stepsyou can get access to the free ebook I put together as well as the workbook that goes along with it.
I’m going to quickly remind you of what those 8 steps are:
- Step 1 – Set aside 2-3 hours a week to start working ON your business and not just IN your business
- Step 2 – You need to Identify the gap between what you are currently doing today in sales and what you are needing to do to hit your target
- Step 3 – Now that you know your need, it is time to Create some Sales Ideas
- Step 4 – Develop a Gameplan with your Sales ideas
- Step 5 – Look for ways to reduce your costs and expenses
- Step 6 – Identify Core Processes that are broken in your business
- Step 7 – You need to identify what resources you need to achieve the gameplan
- Step 8 – YOU MUST SEE YOURSELF as a $100,000 PROFIT BUSINESS.
As I mentioned earlier, I dedicated an episode to working on your business and not just in your business. Back in episode 2 we covered this topic in more depth. Plus, I am sure you have heard this over and over from your personal mentors as well as other podcasts and books that you have read. Hmm, you might think this is something kind of important with so many people reminding you to do it.
The problem isn’t that you don’t know you should do it, the problem is, you don’t force yourself to do it. It is way too easy to get caught up in being pulled in so many directions. Heck, I’m going through this right now in my business. I have all these ideas of what I want to do but I’ve been so busy, I haven’t blocked the time as sacred and just lock out the rest of the world to do it. I need to listen to my own advice. I know by putting a plan in motion for these ideas, I can easily grow my business by 33%. But yet, here it sits on my to do list.
I’m going to bet that many of you are in the same boat. You also have some awesome ideas on how to grow your business or fix broken processes but the day gets away from you and there is goes on tomorrow’s to do list. We must recognize that we must carve out time on our calendar to work on our business. Otherwise we will just continue to be ticked off at ourselves for not doing what we need to do. I’m included in this. I’ve been beating myself up for the past couple of weeks. Matter of fact, right after I finish recording this episode, I’m going to go to my calendar and put a block of time on it that is non-negotiable. Will you make the same commitment?
If we don’t do this, there is no reason for us to move to steps 2-8. The entire process for getting to our $100,000 profit goes out the window and we continue to do what we are doing and getting what we are getting. By the way, for those of you stuck at any level, this goes for you too. You are just as likely to cap at $100,000 in profit as you are $50,000 in profit. You just jump start to go to that next level.
YOU MUST KNOW WHAT YOU NEED IN SALES
Now that we all agree we need to spend more time working on our business, we need to figure out what sales are needed to hit that profit goal. In episode 3, I work on breaking that down more. I’ll warn you, it is more math heavy than I wanted, but let’s face it, one reason we all had 12 years of math was make sure we could figure things like this out. LOL
While I won’t bore you with the math today, the key thing is to remember that your profit, your take home pay is what is left after you pay your product costs and expenses. If you happen to know your average product costs and average expenses, then you can easily figure out this new sales goal. The problem is, many of you couldn’t easily communicate what your product costs are, never mind your expenses. You don’t have to memorize this stuff, but you should have a spreadsheet or log somewhere that you can easily reference to figure out your needs.
To make it easy for those that hate math, I even created that spreadsheet you can download to get a quick idea of what sales you need to hit your profit goal. You just key in a few numbers and it will calculate it for you. So, head on over to localsmallbusinesscoach.com and get that spreadsheet if you want. Plus, check out the video I have there that will walk you through how to figure out your product costs and margins.
Don’t just assume you need to double your sales. While it might get you close, your expenses will vary as will your product costs depending on which items you grow. We will cover this more in a future episode. For now, just put pen to paper and figure out if you need to go from $75,000 in sales to $125,000 in sales to hit your profit goal.
WHOA, WHAT ABOUT TAXES?
In our next episode, we will take a deep dive into brainstorming some sales ideas. But before I wrap up this episode, I want to take a few minutes to discuss why we don’t discuss taxes in our 8 Steps.
I have a few reasons for this. The number one reason is, everyone’s tax situation is different. You each have different items you can depreciate, you have different dependents, you have different expenses, you have different local laws, and a host of other things that impact your tax situation. There is no way to create something that fits everyone. Which is why I look at it this way.
If you worked for someone else and made $100,000 you wouldn’t tell everyone that you actually only made $70,000. Just as I mentioned before, if you and Johnny both made $100,000 your take home would vary for many reasons. So in our scenario, we focus on the before tax.
Please keep in mind, if you want to include taxes in your quest for a true $100,000 take home. No problem. Just keep in mind that you will need somewhere between 25% and 40% after your product costs and expenses. The big swing is due to your deductions, if you have state tax, etc.
Maybe we will dive into taxes more in the future, but for now, we will focus on sales, expenses, costs and processes to increase your profits.
Before I go, I want to stress a key action item for the day. Make sure that you block time on your calendar each week to work on your business. Make it one of those reoccurring items. This will be the most critical step you will do.
Then on the next episode, bring your thinking caps. We are going to brainstorm ideas on how to drive more sales. I’m going to challenge myself to help come up with at least 20 ideas any local small business owner can try.
So, let’s start these 8 Steps together. Get your free eBook and workbook once again at localsmallbusinesscoach.com/8steps. Think about what you would do with $100,000 in profit a year!
And as we wrap up this episode I want you to know, that I realize being a local small business owner can be a lonely gig at times. But you don’t have to do it alone. Just know, I’m always here for you.
By the way, If you like what we are taking about, then make sure to subscribe to the podcast so you don’t miss an episode, if you love the podcast and what we are talking about, then please leave a 5 star review so other local small business owners know this is a podcast that they can’t miss.
Meanwhile, I wish you the best in your business and remember: Great Customer Service, coupled with Great business practices will set you on the path to Great Profits!
Bye for now…..
Have a Question You Want Asked on Air? Shoot Me Your Question
Get Your FREE eBook – 8 Steps to Increasing Your Profits in Your Local Small Business
Our Training Materials for Local Small Business Owners: TrainingforLocalSmallBusinessOwners.com
Starting a Local Small Business Website: StartALocalSmallBusiness.com
My Recommended Bookkeeping Program for Local Small Business Owners: Freshbooks Link
Why? Helps you invoice quicker and more importantly, get paid quicker. Let’s you know when your clients have opened the email and they even help send reminders. Clients / customers can pay right from their phone or computer. Give it a Try: Freshbooks
**Freshbooks is an affiliate link. This costs you nothing. I only recommend due to how much folks have loved it. I am paid a small commission but trust me. Even I use it. Try it for free for 30 days and see if you don’t love it too!
Don’t forget, if you are looking to take your local small business to $100,000 in profit, head on over to LocalSmallBusinessCoach.com/8steps to download the free ebook & workbook called: 8 Steps Local Small Business Owners Need to Take to Make $100,000 in Profit. Where I’ll walk you through how to double or triple your current profit level.
Also, don’t forget to shoot me an email on any topic or question you would love for me to cover in an upcoming episode of the show. Just send your ideas to firstname.lastname@example.org.
And if you are Thinking of Starting a Local Small business, over at StartALocalSmallBusiness.com we have lots of free tools and resources to help you get your local small business started. Plus, we now have a more in-depth course to Help Get you going. It has 12 modules, 50 mini videos and 13 downloadable tools a person can use to start their local small business. You can find the link once again at StartALocalSmallBusiness.com. I also have set up a special discount code for listeners of the podcast. At checkout, just add the code PODCAST to save 25%.
See you on the next episode!
Two Great Books to Help You With Your Small Business:
Highly Recommend all Local Small Business Owners Read the eMyth by Micheal Gerber. You will learn some critical things about running your business.
The second book is one I wrote based off a popular example I always use when folks are trying to understand their role as a leader with their people. Check it out.
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