If you’re thinking about starting or have recently started a new venture, how resilient is your business idea? Have you put strong foundations in place or are you crossing your fingers and hoping for the best?
More than half of business startups fail within the first five years. You can give your business the best chance of success (not just survival) by pausing and learning from the tough lessons that people like me have already taken on board. Just over 12 years ago I was on the verge of financial oblivion; now I’m coaching fledgling entrepreneurs and enjoying the luxury of a work optional lifestyle.
In this blog, I’m going to reveal five insider secrets that are usually reserved for my coaching clients (and I’ll share the next five on 31 October). It’ll help you to understand more about the coaching process, and why it’s wise to get up close and personal with the nuts and bolts of your business.
1) Understand your business
During your first coaching session, we begin by exploring your business (or what you intend to do) and how much you charge for what you offer. This will help to establish whether you have a viable business idea. We will explore if there are similar products or services like yours out there and how successful they are, then we can check if your numbers stack up. We’ll also discuss your sales potential.
2) Where are you at?
Once we know if your business idea is viable, we will dig into the A-D-C of your business, which stands for Assets, Debt and Cost. We will discuss what assets you have (that can support your business journey), what debt you have (if any), and the estimated costs of running your business. This will also help us to uncover your breakeven figure, adjust your sales, or cut back on your costs accordingly.
It’s common for people to underestimate what they owe on their credit cards or personal finance; having a handle on this figure (if relevant) will support you to build financial stability. You also need to know if you are paying interest on your credit card debt and create a plan to reduce or clear it.
3) What’s a pipeline and what’s the point?
If you are a service-based business, you will benefit from having (and filling) your pipeline. For example, if you’re a will writer, you might have a few people who have expressed an interest in your services but are not yet ready to purchase (potential clients); they’re in “the pipeline” (a virtual queue).
If you have 10 people in your pipeline and your average fee is £750, you have £7,500 of potential business in your pipeline. You might also plan to upsell some of your services, but that’s like trying to ski uphill. Instead, think about skiing downhill (so much more flow!): tell people your premium offer, then if they prefer to buy a lower priced product, it will be far easier for you to sell – it’s called positioning your product.
4) Know your stats
How many sales calls do you need to make or how many emails do you need to send to close a sale? You might send 200 emails to potential customers with a 50 per cent open rate (100 opened); perhaps 10 per cent of those who open the email will respond to book a call (10 calls booked), and you know you will likely close 10 per cent of your sales calls, which means you can estimate one sale (and work to improve your close rate!). Even small improvements at each step of the process will have an exponential effect on the end result.
When you know your stats, it’s easier for you to plan ahead.
5) Build a strong mindset
According to American psychologist Carol Dweck, there are two types of mindset: fixed and growth. A fixed mindset will inhibit your business progress because you won’t be able to innovate when the going gets tough; a growth mindset is essential for success because it will help you tap into your resources, get creative, think bigger and remain committed in the face of adversity (more on that in the second part of this series).
Further support and next time…
Which of those five areas of focus do you think would support you best? Even if you think you’ve already got most of these “sorted”, it’s often the process of talking it all through with a mentor or coach that helps you to go deeper into understanding your business and making sure that you set yourself up for success.
I’ll unmask the next five areas we’ll focus on in our work together in my blog on 31 October (spooky!). In the meantime, if you’d like to find out what I can do to support you to get your business off the ground or increase profit and performance, click here to book a discovery call.