Latest / The Matriarchy Would Never | A Promote Yourself to CEO Podcast Series / BONUS! Was 2023 A Hard Year? You Aren't Alone
Transcript
- 0:01SPEAKER_00: Hey there, CEOs.
- 0:02SPEAKER_00: Rachel Cook here, founder of the CEO Collective and host of the Promote Yourself to CEO podcast.
- 0:09SPEAKER_00: I wanted to jump on live today because honestly, I've been a little annoyed at a lot of the hype and misinformation aimed at small business owners.
- 0:21SPEAKER_00: And the one that really, really gets under my skin is when we hear all of this reason that small businesses are struggling.
- 0:31SPEAKER_00: Like you join the program, you get the course, you get coaching, and you ask a real legitimate business question, and it's met with, well, you just need to work on your mindset.
- 0:44SPEAKER_00: Your mindset is the reason that your business is struggling.
- 0:49SPEAKER_00: And I want to talk about this because one of my biggest frustrations in the whole industry that I'm in, people who are supporting small businesses, is the absolute like neglect towards actual forces that do impact small businesses, and then kind of placing blame back on small business owners, like, well, it's your fault, you don't want it hard enough, your mindset's not right, you're not hustling hard enough.
- 1:15SPEAKER_00: And I think we need to get real about what's actually happening in the world of small business right now, especially for micro businesses.
- 1:23SPEAKER_00: So small business would be considered any business that has under 500 employees.
- 1:28SPEAKER_00: That's a huge range.
- 1:30SPEAKER_00: Most of the businesses that I work with are gonna be considered micro businesses because we actually have usually 10 or fewer people on our team.
- 1:39SPEAKER_00: I would say up to 20 people on our team or fewer.
- 1:42SPEAKER_00: Um, our world is very, very different from a business that has hundreds of employees in it, right?
- 1:49SPEAKER_00: And the things that impact us are gonna be very, very different because we are undercapitalized.
- 1:54SPEAKER_00: Meaning, in general, micro businesses, people who have under, let's say, 20, 25 employees or team members, we don't have access to capital, we don't have access to a lot of funding that other small businesses might get access to.
- 2:09SPEAKER_00: We are under-resourced in general.
- 2:12SPEAKER_00: But this is the demographic that is seeing a huge amount of growth.
- 2:16SPEAKER_00: A lot of people are leaving traditional work for a variety of reasons and starting their own small business.
- 2:23SPEAKER_00: They're going into freelancing, they're realizing that they can have a small business with themselves and just a few contractors, and that is the shift we're going to continue to see.
- 2:33SPEAKER_00: My issue is when those same individuals who are brave enough and daring enough to go out there into the world and you know hang their shingles, so to say, and say, Hey, I have this product, program, or service, I can help you, this is what I can do for you.
- 2:47SPEAKER_00: Then they're blamed on their mindset or not wanting it enough or their vibes not being high enough when they're not getting the results.
- 2:58SPEAKER_00: So I get really annoyed at this.
- 2:59SPEAKER_00: I mean, actually very angry at this.
- 3:01SPEAKER_00: So let me talk about some of the things that are actually impacting us that made 2023 one of the hardest years for this demographic of business owners.
- 3:09SPEAKER_00: If you are a woman business owner, if you have a micro business, meaning you have 10, 15, 20 team members or less, you might still be yourself, plus maybe an assistant, um, then you want to keep on listening because last year was an incredibly hard year for this demographic of small business owners.
- 3:28SPEAKER_00: And I've got my little list of what's going on here.
- 3:32SPEAKER_00: So the first thing that we cannot ignore is the economy in the world, right?
- 3:39SPEAKER_00: What's going on in the global economy, what's going on in our local economies directly impacts small businesses, especially micro businesses.
- 3:48SPEAKER_00: You cannot mindset your way out of inflation.
- 3:53SPEAKER_00: You cannot mindset your way out of literally last year, all year long, it was like a recession's coming, a recession's coming.
- 4:00SPEAKER_00: Are we in a recession?
- 4:01SPEAKER_00: Are we not in a recession?
- 4:03SPEAKER_00: These are things that directly impact small business owners.
- 4:08SPEAKER_00: And they directly impact micro business owners, especially because, again, we are generally undercapitalized.
- 4:13SPEAKER_00: Most of us are self-funding our business.
- 4:16SPEAKER_00: And when you're self-funding your business, you don't have like a huge line of credit from your bank, you don't have funding, you don't have financing.
- 4:24SPEAKER_00: These things really impact you because suddenly our clients start to protect their pocketbooks a little bit more, right?
- 4:32SPEAKER_00: They start to become a little more discerning.
- 4:34SPEAKER_00: So we have to pay attention to what's happening in the overall world, the global world, the global economy.
- 4:41SPEAKER_00: Those things impact us.
- 4:43SPEAKER_00: And with inflation came skyrocketing prices for a lot of us.
- 4:47SPEAKER_00: And I don't know about y'all, but I have a family of five.
- 4:50SPEAKER_00: Um, I've got two teenagers and a preteen, and you do not want to know what my grocery bill is right now.
- 4:57SPEAKER_00: Like, there are very real things happening that impact people in a very real way, and you can't mindset your way out of a grocery bill that is through the roof.
- 5:08SPEAKER_00: You know, other real living expenses that are through the roof.
- 5:11SPEAKER_00: The cost of living right now has just continued and continued to climb.
- 5:16SPEAKER_00: And if you are a woman-owned small business or micro business, you are most likely more impacted.
- 5:24SPEAKER_00: I'm not saying men aren't impacted, but women take the brunt of this, the child care crisis that we are currently in, and the elder care crisis that we are currently in.
- 5:34SPEAKER_00: So thank God my kids are out of daycare and everything.
- 5:38SPEAKER_00: You know, they're all older, they're in school.
- 5:40SPEAKER_00: There was a point when I had my twins who are now 14 and my youngest who's now about to be 11.
- 5:46SPEAKER_00: It was costing us about$2,000 to$2,500 a month for the three of them to be in part-time preschool.
- 5:56SPEAKER_00: That's a lot, that's more than our mortgage payment, right?
- 6:00SPEAKER_00: So we have that insanely high amount.
- 6:03SPEAKER_00: And I'm talking to friends now who have young kids who are still needing daycare, who are still needing child care, they're not old enough to go to school yet.
- 6:11SPEAKER_00: And they are paying, when you add that up over the course of the year, you have more than one kid, you could very easily be paying$20, um,$20,000,000 a year in preschool in childcare.
- 6:24SPEAKER_00: It is incredibly expensive.
- 6:26SPEAKER_00: Then you add to it the childcare crisis we're going through right now.
- 6:29SPEAKER_00: Um, during the pandemic era, there was a ton of money put into the economy, and there was a ton of money put into child care.
- 6:37SPEAKER_00: A lot of childcare centers were subsidized by federal funds.
- 6:42SPEAKER_00: That has ended, which means we are now seeing a complete lack of availability.
- 6:48SPEAKER_00: There's not enough child care available.
- 6:51SPEAKER_00: There's not enough childcare centers, daycare centers, preschool centers, etc.
- 6:55SPEAKER_00: Like they literally don't, we don't have enough.
- 6:58SPEAKER_00: And so when there's a lack of availability, when there's a smaller pool of available spots for this, that means those prices are gonna get higher and higher, and they sure are.
- 7:08SPEAKER_00: And who's left, you know, being squeezed here?
- 7:12SPEAKER_00: It's parents, working families.
- 7:13SPEAKER_00: And the majority of the people I work with have that demographic, right?
- 7:18SPEAKER_00: Like women in their 30s, 40s, 50s.
- 7:20SPEAKER_00: We are the working families.
- 7:22SPEAKER_00: We are the ones who we're trying to figure out like how do we put our kids through preschool?
- 7:26SPEAKER_00: And we used to think college was gonna be the big expense.
- 7:29SPEAKER_00: Now you'll spend more for preschool than you will on a college education.
- 7:33SPEAKER_00: You know, it's it's wild how this has impacted women small business owners.
- 7:39SPEAKER_00: So that childcare has gotten more and more expensive.
- 7:43SPEAKER_00: Our general cost of living has gotten more and more expensive.
- 7:45SPEAKER_00: We're in a housing crisis right now where I could not, if I I looked up for me to buy the house that I am currently living in, our mortgage is under$2,000 a month right now because we bought this house in 2013.
- 7:59SPEAKER_00: Based on what it's worth today, if I were to go out at today's interest rates, I would be paying over$4,000 a month for the mortgage on this house if I had to go buy it today.
- 8:10SPEAKER_00: So these are very real factors that are impacting so many people.
- 8:17SPEAKER_00: And you can't mindset work your way out of reality, okay?
- 8:22SPEAKER_00: So all of these things are squeezing us, are squeezing us as a population, and women business owners are more likely to have started businesses because we need more freedom and flexibility.
- 8:34SPEAKER_00: Childcare remains one of the biggest reasons.
- 8:36SPEAKER_00: Over 30% of women entrepreneurs have small children, and child care and access to child care is one of the reasons why we start our small businesses.
- 8:45SPEAKER_00: We need that flexibility because we need to take care of our kids, right?
- 8:50SPEAKER_00: We're the ones who that falls on.
- 8:52SPEAKER_00: We're also the sandwich generation, so I don't know about y'all, but I'm dealing with elder care.
- 8:57SPEAKER_00: I have two aging parents.
- 8:59SPEAKER_00: My husband's parents, thankfully, are in great, they're in great shape, so I'm not as concerned about them yet.
- 9:04SPEAKER_00: But my mother needs full-time care at home.
- 9:08SPEAKER_00: And for the last three years, I have been managing a team of nurses.
- 9:12SPEAKER_00: We have anywhere from six to eight nurses who cycle throughout the week.
- 9:16SPEAKER_00: And I would say last year it ended up costing us out of pocket about$16,000 a month for her nursing care.
- 9:25SPEAKER_00: And that does not include so much, that doesn't include all of the supplies she needs, that doesn't include the cost of us buying a wheelchair accessible um van with like the ramps so we can get her in and out.
- 9:38SPEAKER_00: That doesn't include so much, and I am so grateful we can afford to care for her like this, but it is insanely expensive.
- 9:45SPEAKER_00: Now, my mother has a ton of needs because she's fully disabled, and so that's a very like expensive route compared to probably a lot of people, but still, my grandmother, who's 95, just went into a nursing home literally a year ago, went into the nursing home for the first time, and it is costing us over 10,000 a month to have her in a nursing facility, and these costs are very real, and guess who's bearing the brunt of it?
- 10:13SPEAKER_00: Like families right now.
- 10:15SPEAKER_00: If you are a woman in your 30s, 40s, and 50s, you are probably feeling the squeeze.
- 10:20SPEAKER_00: Okay.
- 10:20SPEAKER_00: So 30 something percent of us are raising, you know, kids who need childcare.
- 10:26SPEAKER_00: Another 30-ish percent of us are caregiving in other capacities, which includes elder care.
- 10:33SPEAKER_00: And then guess what else is killing us?
- 10:35SPEAKER_00: It's the you know, chronic health burnout that is happening right now.
- 10:39SPEAKER_00: We're in a burnout crisis.
- 10:41SPEAKER_00: So many people are struggling with burnout, and not just I don't want to go to work today.
- 10:46SPEAKER_00: I'm talking like I physically can't get out of bed.
- 10:49SPEAKER_00: I am so drained and so exhausted, I have completely run my nervous system ragged.
- 10:56SPEAKER_00: All these things are very, very real factors that impact small businesses.
- 11:02SPEAKER_00: So, what happens when we kind of have this, you know, all these factors hitting us at the same time?
- 11:08SPEAKER_00: When we have crazy inflation, when we have cost of living crisis, we have the child care crisis, we have the health care crisis, we have, you know, this fear of a recession, and we're kind of always on edge about that.
- 11:20SPEAKER_00: Then we're hit with like constant stuff going on in the world.
- 11:24SPEAKER_00: We have the war in Ukraine, we have a genocide happening in Gaza, like this stuff is just hitting us over and over and over again.
- 11:33SPEAKER_00: It's hitting us over and over and over again.
- 11:35SPEAKER_00: And these are things that we can't mindset or meditate our way out of.
- 11:42SPEAKER_00: There is no like high vibe that is going to counteract global pressures.
- 11:48SPEAKER_00: I'm just being a thousand percent honest.
- 11:51SPEAKER_00: Um, oh, and the final thing on my list I wanted to talk about was the 2010s.
- 11:56SPEAKER_00: If you have anybody who's talking about how they've grown their business so much over the 2010s, guess what?
- 12:02SPEAKER_00: Most of the 2010s was subsidized for small businesses.
- 12:05SPEAKER_00: One of the biggest reasons we saw so much explosion in small business was because of the internet, was because of social media, and all of those big companies, when if you were able to get in, I mean, I started my business in 2008, I rode this wave.
- 12:20SPEAKER_00: I absolutely rode this wave, where for the first time ever you could get access to a lot of people to talk to about your business, where you could get cheap advertising.
- 12:30SPEAKER_00: I mean, I remember when ads were like 20 cents, 50 cents under a dollar per email subscriber.
- 12:37SPEAKER_00: That is insanely hard to get today.
- 12:39SPEAKER_00: It's pretty much impossible.
- 12:41SPEAKER_00: So a lot of small businesses that were able to take advantage of those things, they were able to ride that wave, but that wave is over, right?
- 12:50SPEAKER_00: Like those things are gone.
- 12:51SPEAKER_00: You cannot duplicate that again.
- 12:54SPEAKER_00: Um, we kind of saw it a tiny bit with TikTok because TikTok took off, and some people were able to ride that really, really quickly and do really well.
- 13:02SPEAKER_00: But we've already seen in the past, I would say, six months since TikTok really started pushing monetization on their platform.
- 13:09SPEAKER_00: TikTok is now QVC, right?
- 13:11SPEAKER_00: I can barely scroll through my FYP without seeing another ad for something else.
- 13:16SPEAKER_00: So, how does this impact us as small business owners?
- 13:20SPEAKER_00: Well, one, we are seeing that this is changing buyer behavior.
- 13:24SPEAKER_00: This is changing our buyers' behavior.
- 13:26SPEAKER_00: People who were buying from us a year ago, two years ago, three years ago are likely changing what they're spending their money on.
- 13:34SPEAKER_00: Because if you are targeting anybody who is not like extremely wealthy, if you are targeting other people who are also impacted by child care crisis, elder care crisis, inflation, the cost in the grocery store, the cost of the gas pump, if you are talking to any basically most people, then they are really deciding very clearly where they're going to spend their money because all of their expenses have increased, right?
- 14:00SPEAKER_00: And when their expenses have increased, that means they start to cut back on anything that is discretionary spending.
- 14:07SPEAKER_00: Even a couple years ago, there was research saying even even families who are making$100,000 a year, they only had about$2,000 of discretionary spending a year.
- 14:16SPEAKER_00: Um, there used to be a report out there that said you needed like$70,000 a year income to basically be happy.
- 14:24SPEAKER_00: Like there, that was like this is where we see kind of happiness levels off.
- 14:28SPEAKER_00: Guess what?
- 14:29SPEAKER_00: That number has increased to now something like$115,000,$120,000 a year because of the costs of everything that we need in our life has just skyrocketed.
- 14:39SPEAKER_00: So chances are last year you saw people cut back on spending.
- 14:44SPEAKER_00: And if they didn't cut back on spending, they changed the way they were spending.
- 14:49SPEAKER_00: So even in my business, we used to have something like 50 to 60 percent of small businesses who would join us to work inside of the CEO collective.
- 14:58SPEAKER_00: We used to have a very large number of people pay in full.
- 15:02SPEAKER_00: They would be able to just pay in full, pay up front, easy peasy, right?
- 15:06SPEAKER_00: And we kind of depended on that because that's was our cash flow.
- 15:10SPEAKER_00: It was awesome because every time we would open enrollment, we knew that we'd probably have 50 or 60% pay in full.
- 15:17SPEAKER_00: And of course, we'd have to budget that over the course of them working with us, but it definitely made cash flow a little easier on us.
- 15:24SPEAKER_00: Then, this time last year, we saw a massive shift.
- 15:28SPEAKER_00: We saw going from a huge number of pay in fulls to a huge number of people toing payment plans, which of course we wanted to offer because it makes our services, our programs more accessible.
- 15:40SPEAKER_00: But when you have such a drastic shift over such a short time frame, it creates cash flow challenges.
- 15:47SPEAKER_00: So in my research, 82% of small businesses are juggling with cash flow.
- 15:53SPEAKER_00: Meaning we literally have gaps, you know, between when revenue comes in and hits our bank account and when revenue is flying back out.
- 16:02SPEAKER_00: So if you have a massive shift in your cash flow, especially because there's a shift in how people are paying you, they're going from paying in full to doing majority payment plans, suddenly that squeezes a small business owner, and then that squeezes a small business owner and it starts to trickle down.
- 16:19SPEAKER_00: So these are very real things that are impacting small businesses.
- 16:24SPEAKER_00: So I want to share with you a couple things, and then I've got to wrap up because we're doing a masterclass in the collective that I'm really excited about.
- 16:30SPEAKER_00: But if this is resonating with you, and if you're going, okay, thanks, Rach, I really appreciate you sharing like the very real influences that are impacting our small businesses, making our small businesses feel more squeezed, making cash flow tight.
- 16:45SPEAKER_00: I want to share with you a couple things.
- 16:47SPEAKER_00: First, this is where we got to get a handle on our finances.
- 16:52SPEAKER_00: Um, when times are good and money is flowing, it is so easy to get lazy with our finances.
- 16:58SPEAKER_00: And I am the first one to admit, me too.
- 17:01SPEAKER_00: Me too.
- 17:02SPEAKER_00: Like, I will totally be like, we're fine, it's okay, I don't need to stress about it too much.
- 17:06SPEAKER_00: But when you have a major shift like we had last year, and you start to see um, you know, monthly cash flow is dropping compared to the total revenue that you've booked, like you have to be handling that money very, very carefully.
- 17:22SPEAKER_00: So now is the time.
- 17:23SPEAKER_00: If you're experiencing that, now is the time to get a really good look at your books.
- 17:28SPEAKER_00: This is a really good time to go in and look at how you can minimize expenses.
- 17:32SPEAKER_00: I gotta sneeze.
- 17:35SPEAKER_00: Maybe not.
- 17:38SPEAKER_00: Oh, there it is.
- 17:40SPEAKER_00: Um, if you are experiencing that, you've got to sit down with your, you know, with your books.
- 17:46SPEAKER_00: I literally printed out like all of our bank statements and I was just ruthless highlighting things and asking the team like, do we need this subscription, do we need this tools or something else here?
- 17:55SPEAKER_00: Going through like, what are we spending money on?
- 17:58SPEAKER_00: What are we spending, like, is there any way we can streamline this, simplify this?
- 18:01SPEAKER_00: How can we do something here?
- 18:03SPEAKER_00: Um, because if you manage your expenses really well, you'll have an easier time navigating cash flow, right?
- 18:09SPEAKER_00: It'll definitely help.
- 18:10SPEAKER_00: So I I love the profit first system, highly recommend that.
- 18:14SPEAKER_00: But a great bookkeeper and a great accountant are worth their weight in gold.
- 18:19SPEAKER_00: The next thing I think is really important is not to slow down your marketing, okay?
- 18:26SPEAKER_00: When we have periods like this, a lot of people start to pull back on everything.
- 18:32SPEAKER_00: And that doesn't help, okay?
- 18:34SPEAKER_00: If you are already feeling squeezed, if you're already feeling cash flow challenges, but you're not consistently doing marketing activity, you're not consistently asking for people to buy your product, program, or service, you're only compounding the problem.
- 18:47SPEAKER_00: So, one of the biggest things we see for a lot of our clients is maybe in the past, up until last year or so, they were able to be a little more casual with like their marketing calendar, their sales calendar.
- 19:00SPEAKER_00: A lot of the small businesses that I work with depend very much on referrals, but they were realizing that it was all very reactive, right?
- 19:09SPEAKER_00: They were kind of waiting for the referrals to come to them instead of them proactively asking for referrals, creating referral programs, creating client appreciation events, creating something that causes buzz about their business and gets more people to buy from them.
- 19:24SPEAKER_00: Now is not the time to slow that down.
- 19:26SPEAKER_00: If you have been very reactive in the past, you must get proactive.
- 19:31SPEAKER_00: And that's not a mindset thing.
- 19:33SPEAKER_00: That is literally just the way marketing works.
- 19:35SPEAKER_00: When demand drops, you have to do something to build back up demand.
- 19:39SPEAKER_00: And that means you've got to be prioritizing that and prioritizing the visibility of your business.
- 19:46SPEAKER_00: Um, and the final thing I'll say about all of these very real pressures is this is why it's so important to be in relationship with other small business owners and not just people on social media who are just showing you like the highlight reel.
- 20:03SPEAKER_00: Um, there's a lot of people right now.
- 20:05SPEAKER_00: There's we're in launch season, it's February.
- 20:07SPEAKER_00: We all know who's launching because their ads are all over our feed, and those same people are talking about how 80,000 people have found financial freedom through their program.
- 20:17SPEAKER_00: That's not true, that just means 80,000 people have paid them, not that 80,000 people have gotten results, or that they've made X hundred million in their business, and then you realize, oh, that's over 15 years.
- 20:32SPEAKER_00: Like there's a lot of little bit misleading messages, and I think it's really important that we get in relationship with other people because it's so easy to look at the highlight reel that people are sharing on social media that people who are marketing to small business owners are intentionally crafting these stories to make you feel this way.
- 20:52SPEAKER_00: If you're not in relationship with other small business owners who are willing to be honest about what actually is going on, that's when it's easy to get sucked into the well, only if I had this tip, trick, or tactic.
- 21:04SPEAKER_00: If only I, you know, knew how to write this correct uh social media caption or how to do the latest dance for reels or any of that BS.
- 21:17SPEAKER_00: That is not necessary.
- 21:18SPEAKER_00: And you're not missing a tip or a trick or a tactic.
- 21:23SPEAKER_00: What you're missing is a bunch of people who are reflecting to you what's what's really going on in the world in a real natural, honest way, instead of all polished and you know, intended to sell you something.
- 21:37SPEAKER_00: When you get in a room with other small business owners who are being honest about what's going on in small business, that's when we get real clarity and insight.
- 21:45SPEAKER_00: That's how I know that I'm not the only one who went through this last year.
- 21:49SPEAKER_00: Because I talked to my accountant the other week, same, talked to my lawyer the other week, they're seeing it with all their clients.
- 21:55SPEAKER_00: I'm talking to tons of service providers who have agencies.
- 21:58SPEAKER_00: They are all seeing this.
- 22:01SPEAKER_00: And as we get in conversation with other small businesses and they're willing to be real about it, the more clarity we have, and that really empowers us to be you really back in the driver's seat of our business.
- 22:13SPEAKER_00: Instead of feeling like, oh, I just need to learn this other tip or trick.
- 22:19SPEAKER_00: No, I need to get a handle on my finances, I need to have a real strategy, I need to make sure I understand how my cash flow is working.
- 22:28SPEAKER_00: I need to understand that my business is impacted by things beyond myself.
- 22:32SPEAKER_00: And it's okay, like that's part of it.
- 22:35SPEAKER_00: You're, you know, none of us are an island where we can just avoid the realities of what's going on in the world.
- 22:42SPEAKER_00: So if this is helpful for you or if you have any thoughts from this, let me know.
- 22:46SPEAKER_00: I'm doing a live series next week, um, the 90-day CEO Success Path series.
- 22:52SPEAKER_00: And it is very much based on our research-backed, client-proven process to help them get back in the driver's seat, to help them be more proactive in their small businesses.
- 23:02SPEAKER_00: And even when we had a year like last year, which really, really was stressful for a lot of small businesses, it really squeezed a lot of us.
- 23:10SPEAKER_00: We're still feeling the squeeze from all of these external pressures.
- 23:13SPEAKER_00: We're gonna talk about how getting back in the driver's seat and getting control of your business and really understanding how your business operates can make such a massive difference.
- 23:22SPEAKER_00: So if you go to my Linkin bio, you will find the details.
- 23:27SPEAKER_00: You can register.
- 23:28SPEAKER_00: Um, I'm gonna go ahead and hop off because I've got a masterclass I've got to teach.
- 23:31SPEAKER_00: But yeah, all the details are on my Linkin bio, and I'll be popping on a little bit more this week to share about it.
- 23:36SPEAKER_00: All right, talk to y'all later.