Latest / The Life-First Solopreneur / 38. Refining Your Business - Here's How to Adjust Based On Your Results
Transcript
- Carly Ries (00:00): We are in a marketing era where it is really simple to track and analyze your marketing efforts. At the end of the day, if people are visiting your site and not converting, then who really cares how many visits you're getting? Intro (00:12): Bigger doesn't always mean better. Welcome to the One-Person business podcast where people who are flying solo in business come for specific tips and advice to find success as a company of one. Here are your hosts, Joe Rando and Carly Ries Carly Ries (00:32): Welcome to the One Person Business podcast. I'm one of your hosts, Carly Ries. Joe Rando (00:36): And I'm Joe Rando. Carly Ries (00:38): And we are back with another segment of our Solopreneur Success Cycle series. Last week we discussed things to think about as you put your plans in motion and actually execute your business. And today we're discussing refining and re-imagining those original plans after you've been executing upon your business long enough to start to see some real results and patterns. Now remember, you can listen to these as one-off episodes, but we highly recommend listening to the full series to get the most out of it. And before this episode, those are episodes. Oh boy, this is a long list now, 26, 28, 30, 32, 34, and 36. Woo. Okay, let's dive in. Let's do this. I'm excited. Joe Rando (01:20): Okay, so you've been, as Carly said, executing for a while. You've probably seen some patterns, some problems, and maybe some issues. And the point here is to, at some level, slow down for a minute, stop what you're doing and think. Sometimes when you're a one person business, you feel like you're on a treadmill and it's really hard to do that. So hopefully you can find what it takes to step back for a minute. Hopefully you've been keeping notes on the issues that you've been facing as we recommended, cuz it's so much easier than trying to remember everything that's gone wrong or been suboptimal as you went forward with this business. In this section, you're gonna refine and possibly reimagine your one-person business. Write down all the ideas that come from going through this process Carly Ries (02:05): This phase is kind of like a brainstorming session. All ideas are welcome. You may not use all of them, but just jot everything down like Joe said. Then in the next step of the cycle that we'll talk about next week, that's when you'll decide what you're actually gonna do about all of these ideas that you have. Joe Rando (02:21): So, as I said, this is a time to reflect on your business and carve out a few hours a day for maybe a week or so, depending on what it takes. But, carve out a few hours where you turn off all the interruptions and just sit and go through this process and think, Carly Ries (02:36): It's funny cuz as a one-person business, we know you're strapped for time. So this may seem like a waste of time, but you'll be saving so much time in the long run. Trust me, not a waste time. Definitely worth your while. Joe Rando (02:48): Obviously we can't go into the specifics of your particular business, right? It's unique to you, but we can talk about things that are virtually in all businesses and that all businesses have in common. Carly Ries (02:59): Then just take what we say and be sure to apply this thinking to all aspects of your business to make it what it is. Joe Rando (03:06): So let's start at the beginning of this process with respect to your goals and success. This is the first step in the solopreneur success cycle. Defining those. Ask yourself, how are you doing compared to the goals and definitions of success that you started with. Is it working? Is it at least going in the right direction? If it is, that's awesome. This section will help you do even better. But if not, then this section is a crucial next step in your one-person business journey. Carly Ries (03:35): Either way, as we keep saying, take careful notes on each of these sections so you can have a solid list to work from when you decide what to change. Joe Rando (03:44): So the most important question to start with, "Are you happy that you're doing what you're doing or is it a living nightmare?" Maybe something in between. Carly Ries (03:53): Just to add to that, you're not gonna be happy with every single part of every single day. We're talking, are you miserable? Is it taking away from your life? If you aren't happy from that sense, really try to find ways to improve the situation. Again, we're not looking for perfection, not looking for happiness 24/7, but just make sure it's something that you want to be doing. Joe Rando (04:17): Yeah, nobody likes balancing their checkbook, so Carly Ries (04:19): Yeah, exactly. Joe Rando (04:20): Next, again, in the beginning here, are you taking care of your health? This is fundamental. If you're too busy, use this process to find a way to make time. If you just hate exercise, try to find something that works for you. Just a note, walking is a fantastic form of exercise and it frees you to think about your business while you do it so you can feel good about both. Next, what about relationships? Do you have the time to spend with the people you care about? If not, use this process to find time to do so. Carly Ries (04:52): A lot of solopreneurs do run into issues with this and their relationships because their business becomes a relationship. One of the biggest factors in long-term health is having social interaction. Find a way to do it, find a way to get that balance, even if it means waking up an hour earlier, do what you have to do to find that balance because it'll benefit your business in the long run. Joe Rando (05:11): Now we're gonna move on to strategy. As we look back at your operations, you've gotta ask yourself, first and foremost, am I in the right business? Now that seems maybe a crazy question, but in startup culture, changing what you're doing for a business is called pivoting. You start out doing A and then you realize that you'd be better off doing B. Some of the most successful businesses are the result of a pivot. Slack was originally a game company, and while I hate Slack personally, you can't argue with a success. Another question is, how are you doing against the competition? Are you winning the deals you should? Are they just better than you? If they are, you just gotta improve your skills as soon as possible or you're getting beat even though you're the best option. That seems crazy, right? Carly Ries (06:00): If that's happening, you probably have a messaging problem. You may want to consider how you explain who you are and what exactly it is that you do, Joe Rando (06:08): Or it could be an issue with your selling skills. We'll look at this later on in this podcast. Moving on to market position, one key aspect of your market position strategy is pricing. Perhaps you aren't priced in line with the market expectations and that's why you're losing sales. Carly Ries (06:25): But make sure you're actually too expensive before you cut your prices. Fyi. Joe Rando (06:29): Yeah, you don't want to be one of those discounters, it never ends. So with respect to your market position, or product position as we sometimes call it, did you define it as we spoke about in the planning episode of the solopreneur success cycle? If so, you may want to refine it now. If not, now is a great time. If you didn't do it originally, I should say it's a great time to do it. Now. This is another reason the competitors may be beating you when they shouldn't and you may want to consider refining it to get the deals that you want. Carly Ries (06:59): As a reminder, market positioning is defining what you offer in a relatively narrow way so you can appeal to the people or companies you want as customers. For example, the idea is not to be a graphic designer, but instead of brand builder for startups. This will appeal much more to founders or startup companies than the generic graphic designer description that we've all seen all over the place. Joe Rando (07:21): There are other reasons to refine or reimagine your market position. Are you happy with the kind of work you're getting? If not, perhaps narrowing your market position would help you get more of the work you like. Is there not enough work? Then maybe you need to broaden your market position to include a larger addressable market. Carly Ries (07:37): Or maybe you've discovered some aspect of what you do that you really just want to focus on. That's a fantastic reason to adjust your market position so it can be a good thing. Joe Rando (07:46): Now we're moving on to marketing and there's a lot that may need tweaking or even overhauling here. And luckily we have our resident marketer, Carly, to help us. Carly Ries (07:56): So I'll be relatively brief. We are in a marketing era where it is really simple to track and analyze your marketing efforts, whether it be through Google Analytics or another analytics tool you've decided to use. So in this phase, look at your website performance and see where people are converting into customers on it. And I say converting instead of just tracking visits because at the end of the day, if people are visiting your site and not converting, then who really cares how many visits you're getting? Look at social media engagements, check out ad performance. Make sure you're not spending an arm and a leg without a lot of results. You get the idea. Basically take this time to see where your customers are coming from and optimize for those areas and consider adjusting or dropping the areas that aren't benefiting your business. Joe Rando (08:40): That moves us onto the next step. After you've marketed, you need to sell. Unless you have a no-touch sales model, you're gonna be communicating with your prospect before they buy from you. You want to think hard about how you sell your goods and services. All is for not if you at this point. Bringing in tons of leads is not gonna help you if you blow it in the sales process. So if selling still feels difficult or if you're losing a lot of deals, your selling skills may need work and you want to consider brushing up on those. There are a lot of great resources out there. My personal favorite is Tony Robbins' great, though extensive course, on sales called Mastering Influence. It really is amazing. It is a 10 day course It takes some time to get through the whole thing, but it changed my life in terms of how I go about selling. It's not one of those kind of weasely, you know, a, b, c always be closing kinds of programs. (09:35): Moving on from there, financial. This is the fun stuff, right? We all get excited about bookkeeping and accounting. How is your bookkeeping and accounting going? Did you hire someone or are you're doing it yourself? If you're doing it yourself, how's it working out? Is it time to hire a pro? Think about whether you're able to understand your business from the financial statements that you're generating. You are generating financial statements, right? Note that a balanced checkbook is not a financial statement. Next, what about your accounts receivable? How's that looking? Are you getting paid in a timely manner? If not, you may want to consider thinking about ways to get paid faster. The first question here is, are you invoicing in a timely manner? If you're not sending them the invoice quickly, they're not gonna pay you quickly. Invoicing should be a regular part of your routine and they should go out asap. (10:22): You may want to think about ways to improve and speed up this process as a first step in getting paid faster. Once you're invoicing on time, there are a lot of other things you can consider. You could ask for a deposit on your work. Get some money early. You could switch to digital invoicing. There are a lot of products out there that do digital invoicing. I know that QuickBooks seems to have an option that lets you invoice directly from QuickBooks and there are other ones as well. You could accept multiple forms of payments like credit cards or ACH, incentivize early payments with a small discount if there's some kind of recurring model here. Discount monthly subscriptions, send clear reminders starting before the invoice is late. Okay, moving on from that exciting stuff to business operations. Let's take a look at business risks. (11:12): You've been doing this for a while and there's a good bet you've developed some risks that you need to consider. There may be some that are very specific to your business, but let's talk about a few universal ones to at least inspire some thinking here. One of the early ones is becoming too dependent on a few customers. As you get started, you get a customer, you get another one, and sometimes it's very tempting to just do as much work as you can for a few customers. But you have to ask yourself, what would happen if I lost one of these customers? Would my business survive and how would I react in college? I once worked for a company that made costume jewelry components. They had gotten a huge contract with Avon and basically ignored their smaller customers completely to serve Avon. Then Avon dumped them, and then I didn't have a job, nobody did. Carly Ries (12:02): Oh gosh, I'm glad you were covered, Joe. Any size company can be done in if they are too dependent on just a few customers. It's best to work hard to grow your customer base. Joe Rando (12:14): Another risk is supplier issues. Are you beholden to a single supplier for your business to function? What would happen if they couldn't or wouldn't supply what you needed? Or if they raised their prices unreasonably, would you have an alternative? Carly Ries (12:26): Gosh, I feel like that is so relevant right now with all the supply chain issues we've been experiencing. Joe Rando (12:30): And as we've talked about in the past, working capital can be a big risk if you're growing quickly. The good news is that you are growing. The bad news is that, as we've discussed, this can kill you if you will need cash. Get to the bank early before you need it. This looks better to the bank and it gives you the time to jump through their hoops. Getting a loan is always harder than you think, Carly Ries (12:52): The small business administration is a really good place to go for information on business loans. We'll include that link in the show notes, but be sure to check that out. Joe Rando (13:01): Good point. Okay, your business model. What about your business model? Is it working the way you hoped? Are you making a real profit that is cash flow positive after taxes? Here you gotta talk to your accountant. You have one right? Note that net income on paper is very different than cash flow. I ran a company that lost money every year on paper and yet produced a positive cash flow year after year. Things like depreciation, amortization and revenue recognition approaches can cause this, Carly Ries (13:30): Anybody else's head hurt right now because that just made my brain explode. I guess most people should get an accountant unless they are an accountant. But seriously, look at your results and if you're not happy, think about how you might modify your business model to improve things. Joe Rando (13:45): My dad was a great businessman and he used to say revenue forgives a lot of sins. And what he meant was that if you're growing revenue, you can afford to make mistakes as you figure it out. Of course, this does not include working capital, which could be the opposite as we just discussed. Ask yourself, what is the one thing I could do to grow my revenue? It may be raising prices, a great strategy if you have too much work. It may be getting more clients or expanding your offering. Next, let's look at managing your time. How are you spending your time? What are you spending your time doing? How much of it is spent doing the things that directly produce revenue? Are you working efficiently or are you spending a lot of time fighting fires? And, what I mean is dealing with emergencies and things that didn't go well. (14:28): If that's so, plan to spend some time in the next step of the SSC or the solopreneur success cycle, deciding how to fix these problems that'll really pay. And let's talk about outsourcing. One of my favorite topics in terms of use of your time outsourcing is a great way to get more time to generate revenue. Whether to outsource a particular function depends on a lot of factors such as its importance, your skill relative to a pro, the amount of time it's currently taking you to do it, and the cost for a pro versus the cost of your time at your billable rate. Carly Ries (15:00): Joe, we actually have a spreadsheet tool that I'll link to in the show notes that'll help you decide that. Also, I think that if the decision is iffy, people should consider whether they like doing that function or not. Sometimes you need something different to do to keep from burning out. Joe Rando (15:14): Right. Well, in conclusion, this is a process and you won't get through a process by listening to the podcast in your car. You should sit down and work through it in writing or typing your thoughts down and then we'll use this information for the next step in the solopreneur success cycle, which is, Decide. Carly Ries (15:31): Yes. Great stuff Joe. Before we sign off, I just want to remind people, if you want more clarification around any of these topics, you can ask us and other experts in our community at community.lifestarr.com just to shoot us a message within the community and we'd be happy to clarify some things or elaborate if you want us to. Otherwise, that is it for today. If you want to listen to other episodes in the series or guest interviews, be sure to visit LifeStarr.com/podcast or you can find us anywhere you subscribe to your shows. We'll see you next time. Closing (16:05): You may be going solo in business, but that doesn't mean you're alone. In fact, millions of people are in your shoes running a one-person business and figuring it out as they go. So why not connect with them and learn from each other's successes and failures. At LifeStarr, we're creating a one-person business community where you can go to meet and get advice from other solopreneurs. Be sure to join in on the conversations at community.lifestarr.com