Here’s what we’ll cover
Today I’m talking about building a profitable, sustainable and elegant business.
It’s one thing to build yourself a profitable business, but it’s a whole different ball game building a profitable, sustainable, elegant business.
Elegance is the secret sauce. It’s the thing that we add to our businesses once we’ve established ourselves in the marketplace.
It’s the key that gives us back our lifestyle.
In today’s podcast I talk about how to know if you’re ready to build some elegance into your business and regain your lifestyle. I also talk about how to start the process of turning a profitable business into an elegant business.
Here’s the shownotes
Today I’m talking about building a profitable, sustainable, elegant business.
In episode 12 I talked about Financial Freedom and the 7 key elements you need to cement into your business. And the first key element was ‘an elegant business model’ which is what i’m going to talk about today.
But before we do I want to take a couple of steps back. There’s a couple of different stages you’ll go through in your business journey before you find yourself with an ‘elegant business’.
Think of this as a ladder and there’s 3 rungs to the ladder.
The first rung of the ladder is Profitability. You’re running a business and selling stuff and being profitable is the goal.
The second rung of the ladder is Sustainability. You’ve taken a step up and now that you’re profitable you’re looking ahead into the future and asking ‘is this business sustainable, can I keep making profits into the future?’ ‘What do I need to do to make that happen?’
A sustainable business is one that is making you money. It may even be making you enough money to do the things you want to do.
There’s nothing elegant about a business that makes a lot of money but requires you to work 50 plus hours a week.
This is where the third rung of the ladder comes into play – Elegance. Making the transition, the step up from a sustainable business to an elegant business can be a tough one. This is where we want to turn your business from being a big fat time hog into a profitable, sustainable, elegant business.
If your business has a profitable, sustainable future – so you’re on that second rung on the ladder, BUT you’re working excessive hours and the business relies heavily on your attendance.
Then you may be ready to make the transition from Sustainable to Elegant.
If you’re ready to step up to that third rung of the ladder and add a little elegance into your business then keep listening.
Two things I want to talk to you about today –
1 – What is an elegant business? and then importantly;
2 – How does that elegance translate into your lifestyle?
So. Number One The dictionary definition refers to elegance as ‘The quality of being graceful and stylish in appearance or manner.’
An elegant business is really no different, it provides you with enough money for you to do the things you love AND – and here’s the clincher – it also gives you the time to do these things with the people you love.
I’ll give you a few examples of what elegance (or a lack of elegance) might look like in your business.
You’ve got money coming in – but it’s going straight back out – not elegant
You’re working crazy hours yet the profit is no where near where you want it to be – not elegant
You’re drowning in the mountains of day-to-day things to keep the business running – not elegant
You’re waking up at night worrying about ‘all the things’ then struggling to get up the next morning? Definitely not elegant!
You’re probably taking a scattergun approach to your growth, feeling the pressure of cashflow and you’re sick of selling out of desperation. You want to confidently say NO to the work that you know isn’t a perfect fit!
This is what a lack of elegance in your business might look like, then unfortunately it translates to a lack of elegance in your lifestyle.
Your business can kind of suck the life out of lifestyle.
Want to upgrade the family home? Want to put in a pool for more family time? Want to cut back your working week? Spend more time with your family? Go away somewhere nice and not be thinking about work the whole time?
A lack of elegance in your business usually means a lack of elegance in your lifestyle as well.
I know all of that sounds super negative but stick with me and I’ll give you a few things to look at in your business to make it more ‘elegant’.
How elegant is your business? That’s the next step. Turning your sustainable, profitable business into an even more profitable, elegant business so you can have BOTH money and a great lifestyle.
SO how do we build this elusive, elegant business. Today we will cover the first step of the process.
We start with a deep dive into what you’ve already got in your business. We look at how we can make it better, faster, more profitable, more efficient.
First up we need to identify the services and products in your business that have the highest margin. Those that will give you the most buck for your bang.
A great place to start for service businesses is by looking at your Return on Time. What financial return are you getting for the hours it takes to deliver particular services in your business.
If you’re a website developer and your main three service offers are ‘New websites’ ‘Website Rebuilds’ and ‘Ongoing monthly maintenance’, what is your return on time for your new websites? What’s the return on time for the website rebuilds? What’s the return on time for the monthly maintenance? I dig into the ‘how’ of return on time in episode 4 – 3 steps to profitable revenue growth if you want to go deeper into this.
Then once that website company has an understanding of their return on time of each of their main services they have an amazing opportunity to make some really smart, calculated decisions.
The first three things that this website company will consider will be;
1 – Should I be selling more website rebuilds and less new website builds? Or should I focus my marketing and sales time and money purely on new website builds because the rebuilds have a low return on time?
2 – The next thing our website company will review is their pricing. Do I need to adjust my pricing on a particular service? Is my pricing the reason I’m running myself ragged and working 50 hours a week? Is my pricing the reason my employees are taking home more money than me?
3 – OR Can our website company find a faster, more efficient way to market, sell, produce, deliver and service their new builds or their rebuilds? What can I cut out of the process to make things more efficient that really won’t impact the final quality?
Going through this process can uncover areas of your business that you didn’t know were sucking up your time, unprofitable or even areas that are leaking profits.
So let’s recap – there are three rungs of the ladder we step up and into business with Profitability goals. Then we step up to the second level and look to create a sustainable business – one that has real potential for long-term profitability. Then the next – and best level – Elegance. Taking that profitable, sustainable business and making it more elegant. Giving you profit plus lifestyle.
Then finally we talked about where you need to start to create a more elegant business.
1 > Review your margins, your return on time for all of your main services & products.
2 > Based on those margins and ROT you’ll decide should you be selling more of this and less of that?
3 > You’ll review your pricing
4 > You’ll find a faster, more efficient way to market, sell, produce, deliver and service your products and services.
There’s an introduction to how to build the most elegant version of your business. I hope you took something useful away from this.
Wherever you are in the world, have a great, profitable week
If you’d like to find out more about building more elegance into your business head over to www.simplysmarternumbers.com/mastermind and apply to be a member of The Elegant Business Mastermind. A small group mastermind designed to skyrocket you to a smarter, more elegant profit.