Wondering if you should be focusing on making a profit or growing your business?

December 23, 2020
Wondering if you should be focusing on making a profit or growing your business?

You aren’t alone! It’s a balancing act because as business owners we want to see not only profit but also growth in our company!

First of all, remember there are so many experts out there! But you have to do what works for you, your business, your family, and your life!

This is the best time of the year to step out of working in your business and work on your business. When you plan not only for your revenue but your expenses you can go into the next year confident and empowered.

We get asked all the time what does making a plan for next year look like. How do I set a plan?

Here is a great example of how we conduct a planning session with our clients:

Let’s say this year your goal is to really grow your top-line gross revenue in the upcoming year.

In order to grow your sales, you have decided to re-invest in your business. Some business owners reinvest their profits into their business and others reduce their owner’s salary or draw in order to invest in their growth.

First step – Revenue: 

 What is your annual gross revenue goal for 2021?

How many clients, products, or launches do you need to sell to reach that goal?

How many clients, products or launches do you need each month to reach your goal?

 

Next Up – Plan your expenses: 

 Where are you currently spending money? Go through each account and ask yourself:

Do you need to continue those subscriptions, vendor relationships, contractors, and are there any opportunities for improvement?

 

Next how are you going to spend money to grow your revenue: 

  • Hiring team members to free up your time and energy
  • Outsource administrative tasks so you can focus on revenue generating activities
  • Join a mastermind group
  • Hire a coach
  • Paid advertising
  • Improve CRM/Advertising tools and software

As you can see there are so many ways to invest in your business to grow your revenue. It is important to plan which activities you are going to take on and what your expectations of return will look like. 

 When you invest in your growth you might find it results in a loss for the year. This is ok if you are increasing your revenue and most importantly if you PLANNED for the loss because you were investing in your business. Perhaps you built up a savings account or cut back in other areas to make this time of growth work! 

 Once you have started growing you can continue to pivot and do more of what’s working and less of what’s not. 

 How will you know???? You’ll keep reviewing your numbers every month next year!

 

Is your plan for growth strategic?

This blog was adapted from a podcast episode of Home Service Expert, to hear the whole episode click here.

Do you need help setting up your strategic plan for 2021?

Schedule your strategy session here.

Want to learn more, we are here to be a resource for you so schedule a time to chat.

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