SURVIVING TO THRIVING: BUSINESS BOOST 4
18th Feb 2021
Last week, Liza shares the importance of getting systems in place to ensure the efficient running of your professional, beauty business, covering all areas such as the client journey, your health and safety and marketing. Getting these systems in place will help you focus spending time ON your business, not just in it.
Read Business Boost 3. Key Strategic Systems here.
Watch Business Boost 3. Key Strategic Systems here.
Download Surviving to Thriving Guide here.
In this episode, Liza breaks down how to get your numbers in order, to help you forecast for the future.
Business Boost 4. Rapid Fire Wins with Your Numbers
Knowing your numbers is often bottom of the list when choosing jobs to do in your business.
Before you plan fully, your “Big Picture Goals” (discussed in Business Boost 2.), it is essential that you know where you are now, so that you can properly plan for the future.
Most business owners only see their profit and loss numbers at the end of the year, when their accountant shows them. It's too late by then, the horse has bolted! You need a more immediate picture of how your business is performing. A quick, transparent view of where your business is financially. Doing your P&L each month will also save you time on your self-assessment!
Breakeven is how much turnover you need to pay all costs and leave a balance of zero. It is up to you if you want to include your salary into this equation. It is advised that you should work out your breakeven, with and without your salary included. Using this information, you can also work out what your time is worth to you per month, week, day and even by the hour.
We carry out cashflow forecasts for financial planning. Over the last 12 months, this has been crucial to be able to see how business is doing in clear light. When doing forecasts, it is good to have a best case and worst-case scenario. Using your P&L for 2019 and 2020, you will be able to see both ends of the spectrum.
Average client spend is the total turnover, divided by the number of clients. There is no benchmark for this, but the number should be getting higher as you grow. It is widely accepted that the more services a client has with you, the more loyal they will be.
The care factor is the percentage of clients purchasing product from you. The UK salon average is only 5-9%. The ideal you should be aiming for is 40%. The higher the care factor percentage, the higher the client retention.
Download Liza Smith’s “Surviving to Thriving” guide for even more information and exercises you can complete to help boost your business here.
Watch Business Boost 4. Rapid Fire Wins with Your Numbers here.