Entrepreneurial Bookkeeping

We’re going to do our best to simulate what it’s like to have a master bookkeeper who has these conversations with you every month, so you can use that to increase growth and profit. When you get the data back from your lag and lead reports, there are usually three common complaints:

• I don’t have enough revenue.
• I’m not growing my business enough.
• My expenses are too high.

For each conclusion, we’ve already given you a clear action plan. Most bookkeepers are good at giving you the facts, but we take it two steps further by telling you how to interpret the facts, giving you a diagnosis and a cure. When you look at your lead profit and lead marketing reports, you will be able to diagnose any problems and therefore any actions you need to take to manage your business better.

The three main issues listed above are caused by not meeting lead profit report goals. When you make decisions ahead of time, you’ll always be planning for plenty of revenue, reasonable expenses, and consistent growth to increase your profits, both current and long term. When you monitor your reports weekly, you’ll be able to solve small problems before they get bigger. This is one of the biggest benefits of following our formula. No need to wait for your annual tax return to reevaluate your business, when you can make small changes weekly to make sure you end up where you planned.

We often joke that there are very few problems in service businesses that more revenue can’t solve. The only exception is when you grow too fast to accommodate the customer influx and can’t hire support fast enough. This is a good problem to have, however, and is very solvable. You simply turn off your marketing machine until you can take a breath and insert more support and processes. We had to do this when our company growth was extreme. We stopped marketing, took the time to hire and train new people, and created the processes we needed to thrive. Luckily, lots of revenue let us hire and pay some awesome, quick start employees, who solved the problems right away. But just not enough revenue is a much more common and serious problem. It is usually due to mistakes in two areas: planning and action.

Planning

A good plan always accounts for marketing, sales, and delivery. For marketing, you need a defined niche, a great offer, and the ability to provide results to your customers. Remember that your customer is buying an end result, not a vague promise. You need to know exactly what that result is and how well you deliver the path to it. If you do it well, you’ll most likely have a steady stream of customers and an awesome level of confidence in your marketing.

For sales, there’s a direct correlation between the number of offers you make and the sales you make. It is SHOCKING to us how many businesses forget to simply sell. They literally do not ask people to buy from them on a regular basis. Once you figure out that the more you ask, the more you get people to buy, the more motivation you’ll have to keep asking. If you have a good offering and your results are legit, it should be easy to ask constantly. You also need a plan to deliver a great product. You have to make your customers happy to do business with you and part of that means professional and convenient delivery of your product. Happy customers talk about you to their friends and family, bringing more customers in. This can’t be an afterthought—you need a very deliberate plan to create raving fans.

Finally, you need a great monthly financial plan. This is the most obvious and most common mistake we see. It’s astounding how many of our students and clients don’t have clear financial goals or specific plans to achieve them. These same students are shocked and frustrated when their revenue slows down or stalls out. They are always in reaction mode, trying to make up for lost time and money to get back into the black, instead of being proactive and creating the income before it’s desperately needed. Plans should be made yearly and broken down monthly.

Say, for example, that your goal is to make $1 Million a year. To do that you need to make about $84k per month. If your program is $8400, then you will need to sell ten per month to stay on track. Once your plan is dialed in, then your marketing, sales, and delivery plans become easier to figure out. You have to account for the number of leads and conversions you’ll need, minus any refunds. When you work backwards from your goal, the numbers are easy. Here’s a simple breakdown:

500 leads with a 10% conversion to sales call rate
50 offers with a 20% conversion rate
10 program buyers

Watch Brooke and Mark explain this in more detail in this video: