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July 2013

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Small business entrepreneurs are notorious for underearning, (Solopreneurs: Better & Smarter But Maybe Not Richer) even though many small business owners are paid properly according to industry, experience, and competition. Additionally, many small business owners do not overspend. Why, then, are you not making the kind of money you want? Here are 6 critical pieces every small business owner needs to grow their business revenue…and their paycheck.

1. Create a budget. Budgets help you set and achieve your revenue goals. Running a business without a budget is stressful! It’s much easier to achieve financial goals when they are clear.

Anticipate your expenses to determine the sales volume needed to meet the financial obligations and goals for your small business.  If you’ve been in business 3-5 years, your expenses have likely stabilized. Previous years expenditures serve as a good starting point to create your budget. If your business expenses still seem a bit wobbly, your business coach/strategist is a helpful resource for budget and sales projections.

2. Bill for your time. Benjamin Franklin said, “Time is Money”. He also said, “Lost time is never found again.Time is not a Twinkie with a “never ending expiration date”. Time is like milk…it expires. At the conclusion of each hour, day, and week in business, unbilled (or unbillable) time takes its last breath…never to be experienced again. Don’t let billable time expire.

3. Fill your sales pipeline. A common cause of small business underearning, despite accurate pricing strategies, is not enough leads in the sales pipeline. The solution? Focus your efforts on filling your sales funnel for 90 days. You’ll be surprised at what a full sales funnel can do to grow your revenue!

4. Prioritize your business sales and marketing activities. I fully understand the gravitational pull of placing client needs before your business needs. Balancing your business needs with those of your clients is a delicate one. However, if you fail to meet the needs of your business, you’re eventually not able to serve your clients. You’ll  no longer be in business. Make your business needs a priority.

5. Don’t take work that pays less than you require. Your business has a financial requirement. It’s what it needs to make/earn in order for you to stay in business. Although we live in an “everything is negotiable” economy, don’t take on projects/client work for less than your business needs to run effectively. It ties up your time and prevents you from selling that time to someone else at your full rate.

6. Understand your small business numbers. Cash flow, budget, profit and loss, and balance sheet all represent the financial health of your business. Understand what each of the terms mean and how they impact you and your business. Next, make sure you know your small business numbers. It makes you a much smarter, richer small business owner!

Isn’t it time for you to grow your small business revenue?

Related Blog Topics:

The Places Your Small Business Can Grow

Overcomg Underpricing, & its Evit Twin, Underearning in Small Business

30 Ways for Entrepreneurs to Grow Their Business

Show Me the Money! 5 Ways to Stop Underearning in Your Small Business

Do You Know Your Small Business Growth Rate?

Small business owners don’t need to be underpaid to be “underearning”. It’s possible to be paid well yet still bring in less money than you want or need for your small business. In fact, it’s estimated that one in three small business owners are underearning…and most are women!

The following strategies ensure you’re earning what you desire:

1. Establish an accurate pricing model for your small business. Don’t just throw a dart at the pricing dartboard to determine your prices, use common best practices for pricing. One pricing model is discussed in THE FORMULA TO OVERCOME UNDERPRICING YOURSELF & YOUR BUSINESS. If this isn’t a good fit for your small business, make Google your friend to identify other pricing models to get you started or contact your CPA for help.

2. Develop a procedure for dealing with “scope creep”. “Scope creep” is a common term used to describe work that exceeds a predetermined range deliverables for which a price has been agreed upon and approved. A small business policy on how you handle “scope creep”, including how and when the policy will be communicated, ensures you are paid properly for your expertise and time.

3. Decide your “free or discount” policy. It’s easy to develop close relationships with clients when you run a small business. Sometimes these friendships cause small business entrepreneurs to give away their services. Small business owners are generous people. If you want to provide complimentary or discounted service, decide what % your small business can afford. Then stick to it! You might be surprised how your earning potential increases when you reduce the gaping hole of “free, client courtesy, discount” services.

4. Document your billing/accounts receivable policy. Cash flow is critical for small businesses. Although “conventional wisdom” dictates a standard accounts receivable time frame of 30 – 60 days from time of invoice to payment due date, for many small businesses this is the difference between struggle and survive. Throw “conventional wisdom” to the wind and consider a 15 days accounts receivable policy to keep your cash flowing.

Remember to include your policy for late payment fees and/or interest. You’re not your clients banker and/or credit card. Don’t let cash flow for your small business suffer because your clients mismanage their cash flow.

5. Communicate billable time early and often. It’s nice to “throw in” an additional small service for a client, however, this sets up unrealistic expectations for the client. The client develops a false sense of the deliverables and financial arrangement agreed upon. It soon becomes a vicious spin that’s challenging to pull out of.

Communicate your billing policy early and often for services not included in the original agreed upon scope of work. It’s as simple as, “We’re happy to do that for you. I anticipate that it will take X amount of time for X cost. Is that okay with you?”

Are you ready to put the brakes on “underearning”? Let me know if I can help you develop the kind of policies that keep your business flush with cash.

Schedule Free 30 Minute Call to Discuss Your Pricing Strategies

Related Blog Topics:

5 Signs the Price is Right for Your Small Business

Overcomg Underpricing, & its Evit Twin, Underearning in Small Business

5 Things to Fear in Business

The Small Business Pricing Conundrum: Underpricing

Solo Entrepreneurs: Better & Smarter But Maybe Not Richer

Whether you’ve been in small business 6 days or 6 years, you understand the excitement of a pending new product or service launch. You also know how terrifying it can be. Fear and trepidation can sideline smart and potentially successful initiatives. There’s only one solution to make sure your launch goes off without a hitch – grab a match!

Launching a new product or service can feel like running to second base with your foot on first. You really want to move forward but…..(fill in the blank). You get caught somewhere in the middle and are unable to move. That’s an accurate reflection of recent conversation with a former small business client.

On the verge of launching a program she passionately believed in, my client was “dragging her feet”. She wanted to take the risk yet feel safe and assured at the same time. Wouldn’t business be less stressful if both could be accomplished? Unfortunately, that’s not how it goes. An endeavor of any value requires courage to launch. Risk is a permanent part of the equation.

Our conversation reminded me of story I heard years before. Here’s how The Daily Awe tells it.

Ancient Greek warriors were both feared and respected by their opponents. The Greeks were ace at “dramatic demonstration” in order to get the best action out of their soldiers. Once the Greek warriors were dropped off onto the enemy’s shore, the Greek commanders would shout out, “burn the boats!” The sight of burning boats removed any possibility of retreat from the hearts and minds of the Greek warriors. Imagine the impact this had on the soldiers – to see their “safe haven” go up in flames. They were left with no choice but to fight to win — the only way back home was through victory.

I love this story! It’s a story of risk, courage, adventure, and success.  It’s the entrepreneurs story, isn’t it.

I’ve had my share of times in my small business when I wanted an “out”. Having an “out” also meant I wasn’t fully “in”. I wasn’t completely committed. I left a boat waiting on the shore just in case I felt the need to retreat from the heat of battle. Have you had that experience?

What smart, strategic initiative is making you “drag your feet”? Is there a boat or two in need of burning in your business? If so, I have a match. 😀

No matter how well you and your small business services perform for your clients, one special ingredient makes your business irresistible – excellence. Excellence is the lip-smacking value-add that has your clients coming back for more!

How about whipping up some mouth-watering appeal with these nine strategies for infusing your business with excellence:

1.  Remove less-than-excellent behaviors. Thomas Watson said, “If you want to achieve excellence, you can get there today. As of this second, quit doing less-than-excellent work.” Discard actions that don’t include the ingredient of excellence!

2.  Crave excellence. Aristotle said, “We are what we repeatedly do.” When excellence is sprinkled throughout your business, your clients recognize excellence isn’t a some-time thing – it’s an all-the-time thing.

3. Stand out in a crowd. According to Plato, “Excellent things are rare.” Excellence isn’t ego-driven or attention-getting. Performance sparkles when you fold in excellence – even though no one is watching.

4.  Invest in something significant. Seneca said, “Life is like a play; it’s not the length but the excellence of the acting that matters.” Excellence makes your business appetizing.

5.    Make your actions speak louder than your words. “That which is caught is much more important than that which is taught.” This is especially true of children. You can teach them right from wrong but let them catch you with your finger in the frosting…Yikes! Liberally spread inspiration throughout your business for you and your clients.

6.  Do better today than you did yesterday. Pat Riley is one of the greatest coaches in the history of the NBA as he coached a standard of excellence on & off the court for the Lakers, Knicks, and Miami Heat. Pat said, “Excellence is the gradual result of always striving to do better.” Smart direction!

7.  Go the extra mile. The extra mile is rare today. It seems some people want to do enough to get by. Edward Everett said, “I am only one, but I am one. I can’t do everything but I can do something. What I can do, I ought to do, and by the grace of God, I will do.” Give something extra, like a cherry on top, to let others know they are important to your business.

8. Make the most of your time. Do you spend time wishing for what was or complaining about what is? Or, do you invest in time and use it to contribute to your business or that of another? Focus on the appetizing skills, abilities, and opportunities you do have.

9.  Make people nervous. Shana Alexander, an American columnist best known for her contributions to the 60-minute segment Point/Counterpoint said, “Excellence makes people nervous”. Go ahead! Make others nervous – but never let them see you sweat!

Your recipe for success is includes adding that delectably rare ingredient, excellence. You can’t mess this up!

Core Business Assessment


Brooke Billingsley

Vice President
Perception Strategies

Synnovatia is a strategic coaching firm that is detailed and knowledgeable about business. i have a small business that grew from $150K to $750K because of the goal setting and resources that Synnovatia provided. It saves me years of learning on my own.

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