You’ve probably heard me talk about the fun quarterly task- paying yourself a profit distribution.
If you’re new here, or you’ve been deleting my emails (my feelings are only slightly hurt), I teach my readers about a cash flow system that pays them bonuses once every 3 months.
It’s pretty awesome.
There’s another process I recommend doing every 3 months as well. These are a little less exciting, but equally important.
Incorporating these 3 things into your quarterly rhythm will keep your pulse on the cash and ensure money is being used exactly the way you want it.
1.- Run an Expense Analysis
Oh boy! An expense analysis? It’s like having Christmas every quarter!
Look I get it; just reading the words expense analysis probably put you to sleep. But trust me on this one- it’s important.
How many times have you looked at the account and wondered where the money went?
Or looked at the amount of “small” purchases that added up to a big gut punch to your cash?
Or looked to see if you still had the best price on your software/subscription?
Next week I’ll share the step-by-step on how to (painlessly) run an expense analysis on your business. For now, just know that there are 3 main things we’re looking for:
1.- Expenses that need to stay
2.- Expenses that can go
3.- Expenses that can be reduced
Last year when running an expense analysis on my business I discovered my payroll software had added a new tier in their pricing options. It was half the price of what I was currently paying and had everything I needed for the size of my business.
Of course no one was going to call me and offer to cut my bill in half- it was up to me to stay on top of it.
Expenses creep up on us, our needs change, or the options can change. Taking time every 3 months to inspect it is essential.
2.- Calculate Your ROI on Marketing
If you’re like me, you’re always trying to stay on top of the new marketing trends.
Lead magnets. Email sales funnels. Online ads.
While casting a marketing net is incredibly important, there’s one problem that I often fall in to.
I set it up, and then ignore it.
Can you relate?
I spend hours crafting a perfect lead magnet, building the landing page, writing email nurture campaigns, and then never go back to see how it’s doing.
While all these marketing buzzwords sound great on the surface, they are useless if they’re not converting.
A lack of ROI in your marketing not only affects your business, it’s also a sign that you’re undeserving your audience.
So the solution- do an audit on your marketing once per quarter.
Set up a system to track where your sales are coming from. Pinpoint the ones that are bringing in the most business, and find the ones that are falling flat.
From here you can decide how much more attention should be on the things that are working, and if the ones that aren’t working need to be tweaked or taken behind the barn (in the words of Mr. Wonderful).
3.- Do a Product/Process Analysis
“Hi, my name is Craig. I’m an Entrepreneur with shiny object syndrome.”
We should probably start an Entrepreneurs Anonymous group to help with our attention spans.
For most business owners, it’s easy to get caught up in the “next”. The next offering. The next product. The next thing that will take your business to the next level.
So quarterly, I recommend getting into the habit of looking at your current products and processes.
What things are selling well? What things aren’t? Where in the sales process do customers fall off? How profitable are your products? How can you improve your product’s margins?
Bring in a coach to help analyze these things from the outside. Then consult with your team to get their perspective on your offerings.
Some quarters you won’t make any changes. You may simply decide to watch it over the coming months. Other times you might raise your prices, or increase the sales efforts of a certain offering.
You’ll hear me say this a lot: The key to winning with money is being proactive, not reactive.
This is true when it comes to budgeting, and it’s also true when it comes to your expenses, marketing, and products.
Ready to improve the financial health of your business and take home more money?
Schedule a free consultation with me and I’ll show you how.