What do you want to earn?

Seasonality and Doing Business

Posted by Roberta Budvietas on Dec 18, 2012 in Business, Cashflow, Marketing | 0 comments

seasonality (Photo credit: murcoil)

Do you and your business suffer from seasonality?

Seasonality is a challenge for many businesses. It affects their cashflow, their ability to forecast and worse, the decisions and well being of managers and owners.

Some Examples of Seasonality

The farmer plants his crops, often borrowing money to buy the seed and fertilizers, hire equipment and workers against a crop that will come in three, four, five or six months later. What do they do if the crops fail or the weather devastates a crop?

Colleges enroll students at one or two times of the year. The students pay upfront and then the college must use that money wisely over the entire year so that they have the money to pay their bills and payroll and maintain the facilities. And what happens if they have unusual expenses or less (or more) enrollment than expected?

Christmas specialty stores start selling their main wares in about September with best part of their sales coming in December. What do they do after the post-Christmas sales?

Holiday camps, resorts and venues operate 12 months of the year but are often only open for 8 weeks in a year? How do they manage to pay their bills all year round?

Ski fields open when the first real snowfall happens. But what happens when there is no snow or only ice? Yes the snow making machines help but are they the answer to seasonality? And what happens when one year has a six week season and the next an eight week season and the next a four week season and then a twelve week season. What does that do to staffing and other resources?

The less obvious seasonality challenges

Seasonality affects every business in some way. The examples above are obvious examples but what about the following examples:

Slow down for holidays when business to business trading can cease for up to three months in parts of the world.
Changes in time, money and resources at budget time.
Staffing issues when unemployment is low and finding good people is a challenge.
Finding and outfitting premises when there are few properties available.
An unexpected disaster or demand that affects the business operation.
Planning for change and the circumstances of that change are different than expected as happened with the global financial crisis.

Dealing with Seasonality

Since all business experience some seasonality, they need to do the following to manage their seasonality:

Manage cashflow, always keep a reserve for the unexpected.
Make decisions quickly to take advantage of opportunities but do a risk management analysis of what happens if it fails.
Have good insurance cover for business disasters and keep it current and relevant.
Have a good support team to discuss ideas with, coaches, mentors or masterminds.
Remember that this too shall pass and if you have to change than change is required. And business is always about responding to change: changing needs, changing conditions, changing products, changing expectations and changing conditions.
The man who fails to adapt will be out of business quickly

In the comment box, share how seasonality affects you and what you have in place to support the seasonality of your business.

To your future success

Roberta Budvietas

Lighthouses, Business and Earning Money

Posted by Roberta Budvietas on Nov 12, 2012 in Analysis, Business, Buyer Experience, Cashflow, Finance, Purpose, Strategy | 0 comments

How does a lighthouse relate to business and what does money have to do with either?

The lighthouse is a business and to continue to keep the shipping lanes safe, someone needs to pay – pay for maintenance, the lighthouse keeper and the power bill.

This morning Dennis Roberts shared Philosophy ( philo- “loving” + sophia “knowledge” )‘s photo on Facebook.

It says “Many people spend too much time trying to be the captain of someone else’s boat. Learn to be a lighthouse and the boats will find their way.”

Over the weekend Mari Smith interviewed Anne McKevitt. Ann said very clearly that if you are in business you need make money because if you fail to earn then you will be unable to remain in business.

One of the greatest challenges for many business owners is that they fail to realize that money is the power that keeps the light shining in their lighthouse. They need energy to keep the light shining. Without the energy, the lighthouse is simply a dark structure that helps no one.

Over and over again, people are told “do what you love and the money will follow“.

But the money only follows when you and your clients VALUE what you offer.

What is this Value?

Often we think of value as the money it costs or the money we charge.

Value =cost

But actually value is based on worth.

What does “the product or service” give us in terms of time, resources, well-being and prestige.

But, value has become bastardized.

We are taught that expensive means value but often we find that the item or service is not worth what we are paying. We learn that free helps people value what we do, but in essence all people do is acquire the free and then pay someone else for what you also offer because they got the recommendation for a more expensive service.

Just as the lighthouse keeps people away from danger, value added to your product or service can affect the results of your clients.

Our business deals with mentoring and coaching. We cost a business but we can save the business owner time and money by helping them find a better way.

What value does your business add to others?

Do you own a business that delivers value or are you just in business surviving and keeping yourself busy. Share you thoughts. Are you a lighthouse or a ship?

To your success

Roberta Budvietas

What do you want to earn?

Posted by Roberta Budvietas on Sep 10, 2012 in Behavior, Budgets, Business, Buyer Experience, Cashflow, Planning, Vision | 4 comments

What you want to earn and what you earn are often very different for many people.

To earn anything means that you need to do something, say something, produce something or talk to someone. There is always a correlation:-

effort = income

There will be times when the income may seem disproportional to the effort you put in though.

There will be many times when you work very hard and seem to achieve nothing. Oh and before you tell me that winning a lottery or another game of chance, think – you have to buy the ticket or enter the contest.

So let’s look at what you want to earn in your business.

You need to do some research and you also need to do some personal mindset work.

Look at what other similar businesses earn. Keep in mind that the revenue in must also cover the cost of the goods you sold, some of your expenses and the related taxes.
Look at how comfortable you are at charging that rate. If you feel that the norm in industry is comfortable for you to charge than see what happens if you increase that by 10%. Unless you believe that the rates are too high for your target niche, try never to charge less.
Look at what you were earning as an employee and how that income supported your lifestyle. In your own business will this be adequate for you or do you need to earn more? If you need to earn more, what more will you deliver to your clients?
And finally, look at what your clients can afford to pay. If the people you want to deal with can afford what you want to earn, then charge them that price but unless you can find clients who are able to pay you what you want to earn then you will never earn it.
And finally, figure out if there are enough hours in the day to deliver what you want to earn. If you are the sole deliverer of your service and your service delivery model requires you to produce the goods, then you are limited by the time you have available to deliver. For example – If you get paid $20.00 per hour and can only work 5 hours per day 4 days per week, you can only earn 20*5*4= 400 per week out of which you will have to pay costs and tax.

Take some time to figure out what you want to earn and then create a sales forecast and a cashflow forecast to see if you are VIABLE. It always surprises people when they do the numbers how hard it is to earn what they want.

In the comments let me know if you are earning what you want and what you are doing about changing the situation.

To your well-being