Latest / Your Money, Your Rules | Financial Mastery, Wealth Mindset, Leadership Principles, Intuitive Decision-Making, Human Design / 113 | Is Your Business Actually Profitable—Or Just Busy? Using Profit Pillars for Online Business Success
Transcript
- 0:00Erin Gray: Everything that I'm going to talk about today comes directly from the book.
- 0:02Erin Gray: I highly recommend this book for multiple reasons that I'll get into in this podcast, and I'm really going to give you my take on how to use these pillars in a way that actually feels nourishing to your body, your soul and your business.
- 0:19Erin Gray: So if you're ready to start feeling more grounded and clear and confident about your money and in your business, this one's for you.
- 0:28Erin Gray: Do you want to create a system to stop avoiding your money?
- 0:31Erin Gray: Maybe you're feeling guilt and shame when it comes to your finances.
- 0:35Erin Gray: Welcome to your Money, your Rules.
- 0:38Erin Gray: I'm Erin, a former certified financial planner and CFO, and yet I used to avoid my money and had fear, no matter how much we had.
- 0:46Erin Gray: I can't wait to teach you how I overcame my money avoidance and started consistently managing my finances in a really simple way.
- 0:54Erin Gray: It's time to get comfortable with money Before we dive in.
- 0:58Erin Gray: I want to offer that if the backend of your business feels a little messy, like maybe you're having, or you do have, inconsistent, you're looking at your books inconsistently, you are unclear on your cashflow or maybe you just feel this nagging sense that you're missing something I want you to know that I've got you.
- 1:16Erin Gray: You don't have to keep avoiding it and you don't have to figure this out alone.
- 1:20Erin Gray: I'm going to help you get clear, get organized and fully grounded in your numbers so that you and your business can feel steady and spacious In our one-on-one session.
- 1:31Erin Gray: Together, we're going to work through your business finances, create a plan that actually works for you, one that supports your nervous system and your goals and your growth.
- 1:42Erin Gray: I invite you, let's get squared away.
- 1:43Erin Gray: You can head over to my website, generatealifewelllivedcom and schedule your session.
- 1:49Erin Gray: Today.
- 1:49Erin Gray: I am breaking down the book called Profit Pillars A Proven System to Maximize the Bottom Line in your Online Business, by Parker Charles Stevenson.
- 2:00Erin Gray: Everything that I'm going to talk about today comes directly from the book.
- 2:04Erin Gray: I highly recommend this book for multiple reasons that I'll get into in this podcast, and I'm really going to give you my take on how to use these pillars in a way that actually feels nourishing to your body, your soul and your business.
- 2:21Erin Gray: Okay, so there's four pillars and the first pillar and it's in no specific order, but what he does is he breaks it down into four pillars and then the percentages that he has seen in online businesses, which are like what is a good percentage, profitability wise, what's an okay, and then what's kind of on the excess or the outer.
- 2:41Erin Gray: You know where you might want to start looking at.
- 2:43Erin Gray: Hmm, maybe I'm, uh, might be spending a little bit too much in that area.
- 2:47Erin Gray: So the labor expense is one of the pillars and this includes, like your contractors, so like your VA, copywriter, customer service, ops manager, podcast person that produces if you do have a podcast social media manager, tech support just all of your contractors that you employ, and I shouldn't say employee, because a 1099 is not someone, it's not an employee.
- 3:08Erin Gray: But you get what I'm, what I mean If you do have employees.
- 3:11Erin Gray: This also takes into account your owner pay, as well as any type of payroll taxes, anything of that sort.
- 3:17Erin Gray: Team morale.
- 3:18Erin Gray: You know, understanding your labor expenses, you really get to see like, are all of the people that are on my team really supporting the growth of my business in the best way?
- 3:24Erin Gray: You know if you are throwing spaghetti at the wall and you're hiring without a strategy, sometimes that can lead to leaky spots.
- 3:28Erin Gray: So it really you get to get clear on what are my labor expenses.
- 3:31Erin Gray: So the second pillar is lead and conversion costs and this is, you know, what does it actually take as a whole?
- 3:39Erin Gray: You know what am I spending to get clients.
- 3:41Erin Gray: So these pillars include like advertising, if you're paying for.
- 3:45Erin Gray: You know social media advertising, like Facebook, um, any type of affiliate fees or marketing costs.
- 3:52Erin Gray: You know merchant fees.
- 3:53Erin Gray: So, like your payment processor, like Stripe or whoever you use as your um merchant fees.
- 4:01Erin Gray: So this pillar helps you evaluate you know if your marketing investments are actually turning a profit.
- 4:09Erin Gray: You know, sometimes we will invest in advertising, but if we aren't clear on our message, it doesn't matter how much money we're pouring in to our marketing.
- 4:20Erin Gray: If our message isn't clear, no amount of fuel to the fire is going to create the client right.
- 4:25Erin Gray: So it really gets you to see.
- 4:28Erin Gray: You know where.
- 4:29Erin Gray: What is my cost for.
- 4:32Erin Gray: You know getting clients and is this going to be a sustainable long-term strategy.
- 4:38Erin Gray: The third pillar is any type of offer delivery expenses.
- 4:42Erin Gray: So, like, what does this actually cost or take to deliver my service?
- 4:47Erin Gray: So this pillar includes, like, if you are, if you have a group program, like, and you have teachers or coaches or instructors inside or guest speakers, um, any type like if you're doing some in-person event, like event expenses, any type of printing costs or product fulfillment, like if you're mailing out workbooks or whatever.
- 5:05Erin Gray: So you really just get to see, you know how much does it cost to deliver on the promise that you make, you know.
- 5:13Erin Gray: And so if this pillar, if the percentage, is too high, then obviously it's going to impact the overall profitability right of your business.
- 5:22Erin Gray: So just taking a look and seeing, like okay, I have priced it at this, but my profit margin is X, is that in, is that in alignment, you know, with the percentages, or am I too high to you know?
- 5:34Erin Gray: Am I really running lean?
- 5:35Erin Gray: Like what does that look like?
- 5:36Erin Gray: So it really you get really clear.
- 5:39Erin Gray: And then the last one is operating expenses, right, so this is all the backend stuff, like what I think about, like what, what goes on, regardless right Of how many clients you have, um, what keeps the business running right.
- 5:53Erin Gray: So this pillar includes, like legal and tax insurance, any type of professional fees that you might have, office supplies, um technology, any type of travel, computer expenses, bank charges or annual fees for credit cards, things like that.
- 6:08Erin Gray: And so these are just your general operating costs that are necessary to keep your business running smoothly.
- 6:16Erin Gray: And so really keeping these, looking at them, first of all knowing what percentage you're at and this is all going to be a percentage of your total income, right?
- 6:25Erin Gray: So what are these costs in relation to your total income generated?
- 6:30Erin Gray: And so you really get to see.
- 6:33Erin Gray: You know where.
- 6:34Erin Gray: Where am I doing?
- 6:36Erin Gray: Well, what could I maybe improve on?
- 6:39Erin Gray: And, and I think more than anything, you know when we get clear on our numbers and then we we start making decisions from that place.
- 6:47Erin Gray: Like, like I said, if you are trying to throw money at marketing but you aren't clear on your message, let's just use that as an example.
- 6:56Erin Gray: You might be throwing money that isn't actually going to be an ROI for you, because really, what you need to look at is is my message clear?
- 7:04Erin Gray: And I just use that as an example.
- 7:06Erin Gray: But I think a lot of times we think or maybe we need to be doing more organic marketing instead of paid.
- 7:14Erin Gray: So you just really get to be really clear, and I think it's a much better system for people with an online business than a brick and mortar.
- 7:23Erin Gray: And so questions that will let me recap, you know.
- 7:27Erin Gray: So the four pillars are your labor expenses, your lead and conversion costs, your offer delivery expenses and your operating expenses.
- 7:38Erin Gray: And, like I said, when you go buy the book, he breaks down everything for you.
- 7:42Erin Gray: So either you or, if you have a bookkeeper, you can literally change this all in QuickBooks or whatever your accounting software is, so that when you pull your P and L, you'll be able to see exactly what those percentages are, which is amazing Like you can gain such clarity in probably an hour, hour and a half of implementing this.
- 8:01Erin Gray: So some reflection questions that you can ask yourself is how do I want to make my spending decision in each pillar more intentional and more aligned with my goals?
- 8:12Erin Gray: Like, first and foremost, like anything right, awareness is key, getting really clear on where you are and then moving forward Once you know what your percentages are.
- 8:20Erin Gray: Okay, how do I want to, you know, make sure that those decisions that I'm making are in alignment with my goals?
- 8:27Erin Gray: And maybe you might have, like, what are some of my money blocks when it comes to labor?
- 8:34Erin Gray: Like, if your labor is really low and you're feeling burnt out and you're doing it all yourself, okay, why haven't you hired someone?
- 8:41Erin Gray: What is going on from a belief system standpoint, that is, create, that is, you know, not allowing you to hire or you're choosing not to hire someone.
- 8:50Erin Gray: What are some of those mindset shifts that you might need to make in order to hire someone out?
- 8:56Erin Gray: So it may not be just with you know labor, but do you have any blocks when it comes to these pillars right, lead conversion or offer delivery or operating expenses or labor and really getting clear, like, where are, where do you stand, what are your numbers and where are some of your limiting beliefs?
- 9:15Erin Gray: Okay, that's what I've got for you today.
- 9:18Erin Gray: If you want a space to explore money and mindset and business in a way that honors who you are and where you're going, I would love to invite you to join my free Facebook group Money Mindset Tips for Women in Business.
- 9:31Erin Gray: It's a space where we talk about money, financial strategies, nervous system regulation and what it really takes to build wealth as a woman in business.
- 9:44Erin Gray: No, you don't have to do this alone.
- 9:45Erin Gray: Come be with us in a community with other women who are really rewriting their money stories.
- 9:51Erin Gray: You can search on Facebook just money mindset tips for women in business, or you can click the link in the show notes and you can join there.
- 9:59Erin Gray: I would love to welcome you there and I look forward to seeing you.
- 10:03Erin Gray: Okay, until next time.
- 10:04Erin Gray: I'll see you in the next episode.
- 10:05Erin Gray: I would love it if you would leave a review for this podcast.
- 10:08Erin Gray: It helps the show grow and I love hearing from you.
- 10:12Erin Gray: And if this episode resonated with you and you have a business bestie who is also avoiding her money, will you share this episode with her?
- 10:20Erin Gray: My mission is to help more female entrepreneurs feel safe and empowered with their money.
- 10:26Erin Gray: Okay, I'll see you in the next episode.