This article was originally published on InCredibly, which provides small and medium sized businesses with financial insights and advice from evaluating working capital needs, to sourcing the right funds and using them wisely. InCredibly helps SMBs navigate the financial nuances of business.
When you run a small business, it’s easy to get caught up in the day-to-day activities that consume your life. Whether you are scheduling, fulfilling orders, rendering services, or balancing the budget, the hours are jam packed and can be overwhelming. That can make it easy to confuse being busy with being productive, and can make it even easier to confuse revenues with profits.
It’s crucial to remember that your number one goal as a business owner is to make money, so don’t be ashamed to make profits a top priority. Below are three strategies I share with my coaching clients to help them stay focused on profits:
#1 Keep it in perspective.
You can be in business to make a difference and to have an impact, but ultimately if you aren’t making money you aren’t going to get very far. For many business owners it is difficult to be upfront about wanting to make money. They feel bad saying that they want to make money and even worse if they make a lot of it. But isn’t that the point? You are cheating yourself, your family, and the marketplace by not making as much money as you can.
#2 Charge what you are worth.
Be the best and don’t be afraid to charge for it! Don’t let your limiting beliefs about money prevent you from thinking others will scoff at your prices. If you are great at what you do then don’t be ashamed to charge for it! When you charge what you are worth you will attract those that see you as worthy. Plus, when you charge a premium the perception from your clients is that they are receiving premium value and the best the market has to offer.
#3 Know your numbers.
Be empowered to not only know your numbers, but know what they mean. Have your hands in your books and find the key numbers that matter to you. Once you know what your profitability is, it can become a game to see how high you can get it, how low you can drive costs and always looking for indicators that can help you move those dials. When you are plugged into your books, and your CFO knows it, it helps keep people honest, including yourself. Don’t forget that high volume doesn’t mean high profits. Look at percentages to help you stay focused.
In order to stay in business (and maintain your personal sanity), your business needs to be making profits. In our restaurant group, one of our core values is Grow, which applies to everything from loyalty to awareness, locations to revenues, and yes, even the growth of your profits. I like doing good things with the money I make, not only for myself, but for my family and my community, and that’s why I’m okay with making money. I’ve never been ashamed to say I like making money, and you shouldn’t be ashamed either!
About the Author
After over two decades in politics, public relations and marketing, Misty Young risked everything to buy Squeeze In, a tiny, struggling restaurant nestled in the historic downtown Truckee, California. Misty helps other restaurateurs and small business owners “attract success, wealth and prosperity” in their businesses, and speaks internationally about “The Five Irrefutable Laws of Restaurant Success,” the centerpiece of her nationally acclaimed, award winning book, From Rags to Restaurants: The Secret Recipe. Connect with Misty on Twitter at @restaurant_lady.Follow on Twitter More Content by Misty Young