Today, Kelsey, our Lead Account Manager, joins me to discuss what you need to prepare for in order to take an extended leave in your business as an entrepreneur.  

Whether it’s for maternity or paternity leave or you’re taking some time off to enjoy your summer, learn what you need to have in place before you leave so your business can continue to profit and thrive behind the scenes. 

In this episode, Kelsey and Danielle also discuss: 

  • A checklist you can use to get prepared for an extended leave 2:15
  • Auditing your own responsibilities as a CEO 2:33
  • Preparing your team for an extended leave 5:23
  • Why SOP’s are so important 5:42
  • Creating courses or digital products as a way to serve when you’re not present 7:00
  • Checking your KPI’s and why you need to 10:14
  • Making sure you have your business savings in place 12:39

Connect with Danielle:

Website |

Facebook |

Instagram | 

Twitter |

Things Mentioned in Today’s Episode: 

Book your FREE strategy call

Download the checklist – Extended Leave Prep PDF

Full Episode Transcript:

Intro  0:00  

Welcome to entrepreneur money stories, the podcast for women entrepreneurs who want to dig into their money stories so they can break free from limiting beliefs around money once and for all hosted by Daniel Hayden, owner of kickstart accounting, Inc. This podcast is a series of real conversations about money mindset with valuable and action packed takeaways for the entrepreneur who’s building their abundant empire. Danielle is a reformed corporate CFO who’s on a mission to help rural breaking female entrepreneurs understand their numbers and gain the confidence to create sustainable profits. And now here’s your host, Danielle Hayden.

Danielle  0:40  

Kelsey, welcome back to entrepreneur money stories.

Kelsey  0:43  

Thank you for always being happy to be here.

Danielle  0:46  

So I’m really excited for today’s episode. We hear a lot from our clients that they are interested in taking a step back from their business and taking an extended leave. A few examples of this could be maternity leave, maybe even paternity leave, I don’t want to, I don’t want to leave the guys out, extended vacation or sabbatical. Maybe just surgery or health, maybe just mental health and recovery are all really good examples of a leave that as a business owner, there’s so much that has to go into preparing for this type of event. And we hear we get this question from our clients a lot like how do I budget for it? What are the finances that I need to think about? So Kelsey, and I thought it would be really helpful to come on and just really break this down? What do you need to have prepared? Why do you need it prepared and really take the lead that you need and that you deserve in your business, and we want to arm you with the tools to be able to do that. Alright, so Kelsey, and I have broken this up into three different sections of our business operations, sales and service, and then finance. So Kelsey, when we are talking to clients about preparing the operation side of their business, what are some of the things that come to your mind that our audience can use as a checklist to get them prepared, so that the operation side of their business can continue without them?

Kelsey  2:15  

Yeah, so who’s who’s answering the phones? Who’s taking discovery calls, if you’re a business that has discovery calls, who’s going to run payroll, if you have a team? How are the rest of your bills going to get paid while you’re gone? And really, any other day to day duties that you do that someone else is going to have to take over?

Danielle  2:33  

Yeah, so I know that there’s a lot that can be there. So I’d recommend taking an audit of your responsibilities as a business owner. It’s probably been a while since you’ve done this, and you might not even remember the tests that you do. So I would recommend taking a notebook or an Excel file. And, you know, have this follow you around for the next month, and jot down all the small things that you’re doing. So from an operation side, like Kelsey said, Who’s submitting payroll, and this can include contractors, so who’s paying your contractors? If there’s any projects in progress? Who is going to oversee the projects that are outstanding and bring them to completion? Are there any back end systems to your business that you are the responsible party for? So what systems can you use so that those systems are automatically working on your behalf, so that you don’t have to touch every single system, every single email, I didn’t plan on talking about this, that we can, there’s also the marketing piece of this, right? If you are somebody who is currently doing your own marketing, planning ahead of time of any social media, blogs, podcasts, I know we work with a lot of clients who do outsource this part of their business or they have an internal team member. But that is another area where if you are handling that for your business, to either bulk plan ahead, or have a team member or consultant who can step in on your behalf and take over during that time.

Kelsey  4:09  

That’s a good one. I didn’t think about that one before.

Danielle  4:11  

Yeah, I didn’t either. Yeah, the next sector of this triangle of things to think about is sales and service. So when I think of sales, there’s a few pieces, there’s who’s taking discovery calls, who is closing your sales, and then who is servicing your clients. So while you’re away, are you currently generating revenue for your business? And who will be actually servicing those clients or fulfilling those orders on your behalf? So Kelsey, what are some ways that you’ve seen our clients prepare? I know we have listeners who are along the spectrum, right? So you might be a sole practitioner right now. You might be a solo business owner who is the number one revenue generating person, right? You are the number one service provider. And then we have other listeners who have a team and are no longer the primary, or they have a core. So what are some examples of clients that you can think about that are prepared for this? And what did they take into consideration?

Kelsey  5:23  

Yeah, if you know that your leave is going to be quite extended, so two weeks, three weeks in longer, you may have to train a team member to take over those sales duties for you. If you’re talking Oh, vacation, that’s maybe a week longer. So I find that some clients just don’t take sales calls at all and take the hit to the business.

Danielle  5:42  

Yeah. And I think this is a great place. You know, any longtime listener has heard me talk about SOPs, standard operating procedures, we put this into place as a kickstart. So when you book a discovery, call a kickstart, you might get Kelsey or I. And when we first transitioned this, this role, we had to do it through standard operating procedures, and documenting this really helped us as an entire organization, who are we? What do we do? How do we do it and getting with our marketing team and making sure that we are all speaking the same language? So I cannot talk about the SOPs enough, especially as you’re thinking about taking any type of leave in your business, what resources can you leave those team members so that they can fill your shoes, right? And maybe even fill your shoes, you know, better? Right? Not just not just temporarily fill them but exceed your, your expectations. So give them that guide so that they know where they’re going. In terms of service? I think we’ve seen some of our clients who say I’m the number one service provider, but how can I still bring revenue into my business? And so we’ve seen clients create courses or online programs or ways to continue to service their clients temporarily. Are there any other considerations to consider Kelsey, when thinking about removing the business owners revenue from the business?

Kelsey  7:12  

Yeah. So you really need to sit down and think about what are the effects of the business without me. So if you are a main revenue generator for your business, I would highly suggest sitting down during the planning process and taking out that revenue and seeing what’s leftover. And then after that, what are your average monthly expenses? And then what is that number after that? Is it a negative number? Will the business not be able to run its own without you? If so, then it’s time to look for maybe open a line of credit to get the business by without you during this time?

Danielle  7:47  

Yeah, I think it’s really important to understand what you contribute to the business. And does that serve your long term goals, right? So you can use this leave in two ways: you can prepare for the leave temporarily, and understand what the income and expenses are for removing your revenue from the business on a temporary basis. Or you can think of this as a long term transition where you can start to think about if I remove myself as a revenue generating individual in the business, how can I long term, fill my team, fill my team’s book of business, so that the business can no no longer be needed? And I mean, don’t let that hurt your ego? It still needs you. But how can we remove that revenue so that the business can stand on its own two feet, and that you as the business owner, can actually pay yourself on the profits of the business. So this is a really important financial analysis. That leads us into the third area of the business, which is, which is finance, to me the most important area? So in this area, there’s a lot to think about, you know, we mentioned, understanding your numbers and what the sales what the revenue and expense, the revenue, expenses, and the profits will look like, without you in the business. But taking this one step further. I’ve talked a lot about dashboards over the years. And I, I love dashboards. I think that they are a way for a business owner to get a snapshot of their business on a regular basis without having to get into all the weeds. And so I’d like you to imagine yourself on a deserted island, you’re going to be stuck there for six months. What are the KPIs? What are the metrics that you’re going to need to know in order for when you survive this deserted island that you’re going to go in to be able to step back into your business. So we have a laundry list of KPIs. They’re not all going to fit your business. But it’s really important to think about as you’re planning for this leave. What are the KPIs that your bookkeeper or your operations team can send you so that you can feel like you have the pulse on your business? If you can understand what is working and what’s not working without you so that you can learn from those mistakes, but also know if you do need to jump in in an emergency. So Kelsey, what are some of the KPIs that you found that have worked really well for our

Kelsey  10:14  

clients? Yeah, so are some other top KPIs that will give you a good pulse on the business. And when you step off of this island, kind of get an idea of what you’re walking into with your business would be gross profit. So how you would get that would just be direct costs divided by your revenue, your direct labor percentage, time utilization, that one will give you an idea of all of the hours worked, and how many of those were billable. So you kind of keep an eye on non billable hours. Project efficiency, if you’re a business that has ongoing projects, close rates. So if you are a service based business or sales, what is that close rate? Is it similar to how it was before you left or has that close rate gone dramatically down, those are the main ones that will kind of help you get a pulse on how the business ran while you’re gone. What all about completed, things like that.

Danielle  11:13  

So it’s just a bit different depending on if you are a sole practitioner, or if you have a team. So if you have a team that’s going to be continuing to run the business in your absence, then these KPIs will change a little bit. So things like the team utilization, the project completion, client retention, if you have somebody who’s handling the discovery calls for you, close rate, this might be all of your operating expenses compared to prior periods, and compared to what you budgeted for during this time period. So again, these will be metrics that you can use, if you have a team running the business. The metrics will be different if you are a sole proprietor, if you are leaving the business and possibly having that course that I mentioned, but you are actually removing yourself from the business, things like your cash balance, your savings in your operating expenses that you have to continue to pay just to keep the business afloat, will be more important in that type of business. But speaking of savings, I talked about it all the time that I know, we were all surprised by the pandemic. And I think we all learn a hard lesson about having enough money and savings. But I think that when we start to think about planning for leave, we really need to start evaluating what we have in our savings. So Kelsey, what are some best practices that you’ve seen with clients that have worked really well, in terms of how many months to have saved?

Kelsey  12:39  

Yeah, I would suggest at least three if you can, after that, you could do a percentage off of the top. So I guess, there’s a couple of ways you can do this, you can try to have like the three months and the savings and then a percentage after that. Or you can just do a percentage of your gross sales, whatever percentage works for you and your business, automatically every month just transferred right to the savings to build the account. That way. As you go on leave it’ll be helpful to know how long that savings account that you have, right when you leave, that will last you. So for this one, you’ll need to know what your average monthly expenses are. And keep in mind that these could increase while you’re on leave. If you are outsourcing some things that you previously did yourself, that definitely adds to your average operating costs. So just make sure you factor those types of expenses in there when you’re doing this analysis.

Danielle  13:32  

Yeah. You guys have heard Kelsey and I talk about budgets religiously. And this is the importance of a budget. So understanding what your monthly expenses are currently, and then budgeting for what the time period is going to look like. We’ve done this with a lot of our clients where we’ve said, what are the goals of the leave? Right? Where is the business we want to come back to? And what expenses are we going to need to lay out to ensure that you are able to come back to the business that you have left? Yeah, that’s perfect. We know that this is a big commitment when you have decided, as a business owner, take a lead from your business. So we are going to offer you a checklist. You can find the link in the show notes that will walk you through each of these categories of your business and how to prepare to take that time away from your business that you deserve. So don’t forget to click the link in the show notes. We will review what you need in order to lead your business for operations, sales and service finance and then a KPIs that you’ll want to track how many of them and then when you want to receive them. I hope that you are able to take this checklist, plan for your leave. And then don’t tune into the podcast while you’re gone. We’ll be here waiting for you when you get back. Kelsey, is there anything else that you can think of? No, I

Kelsey  14:57  

i think we hit all the main points.

Danielle  14:59  

Some Alright, thank you for being here. Thanks. I hope you’re enjoying another amazing episode of entrepreneur money stories. I had to interrupt to tell you about one of our favorite financial management tools, the profit planner book series. Do you want to begin managing your business finances but don’t really know where to start? Our profit planner book series is a perfect way for you to learn how to properly manage the finances of your business. From planning to execution. Start with profit planner foundations as a beginner friendly financial planner that educates you on each aspect of your bookkeeping, and then jump right into profit planner financials, where we walk you through our proprietary framework for understanding your financials. If you’re ready to learn how to use your finances to make better informed decisions, and the key performance indicators you need to track to know your numbers, then the profit planner is the right tool for you. If you’re ready to commit text Prophet planner to 844-499-6969 again text Prophet planner 844-499-6969

Transcribed by