You can’t manage what you don’t measure. Have you checked your business’ breakeven number?
This year is coming to an end and a new year is starting, so now is a really good time to analyze it.
Sometimes your expenses, as your business grows, tend to change. And as revenue and expenses change, your break-even number will as well. So, as a business owner, it is required that you know what your fixed and variable costs are going into 2022 – or any new year.
As you look at your costs, you will be able to see what you had spent in 2021 that will no longer be spent in 2022. Perhaps you invested in coaching at a networking group or in an advertising cost or a one-time expense to redesign your office, maybe you invested in new photography, or any one-time expense you had, analyze those costs, make sure they are in check, and see if any will be repeating in 2022.
While you’re exploring them, scan where you can trim the fat. Think about how you can improve those expenses and if you can cancel any that will no longer work the next year. If you or someone on your team needs to connect with a vendor, renegotiate a newer platform. I went through this with a lot of the software within Timber Industries, and within iEvolve Consulting too. There were some subscriptions that we signed up for that we weren’t using anymore. They were fixed costs so I knew we had to get rid of them. We didn’t need them anymore and that right there? Saves money.
Your profit and loss is all about increasing your top line and increasing your bottom line revenue. The best and only way to do that is to manage your expenses in between the operation of your business. This is an amazing KPI to have and measure either on the daily, weekly, monthly, quarterly, or annually if you can. It’s a great key performance indicator to help you with your business.
Now, I want to hear from you! Look at your breakeven number, take a close look at what your fixed costs were for 2021 and what they potentially will be for 2022. Trim the fat, and stop paying for things you don’t need or use. Reach out directly to me on my email email@example.com and tell me did you come over or under your breakeven number this year?
Keep evolving, entrepreneur! I see you, I get you, and I’m so proud of you.
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About Annette Walter
Much like Marcus Lemonis, host of CNBC’s “The Profit,” who lends his expertise to struggling businesses, Annette analyzes businesses, supports them with the right resources, and designs the plan they need to go from surviving to thriving.
Annette Walter has started, acquired, owned, and operated more than 15 companies in her lifetime. As a wife, mother of two young boys, and owner of a national company, Timber Industries, that was included on last year’s Inc. 5000 list, she can serve her true purpose and passion in coaching and consulting entrepreneurs through her business coaching company, iEvolve Consulting. Annette works with business owners across the globe in various industries to support their overall well-being, teams, and operations. As an operations expert and strategist, she works with business owners to help them identify organizational gaps and opportunities in their companies. She works with businesses to help make their finances, marketing efforts, technology solutions, and sales more efficient and effective.
If you would like to know more about iEvolve Consulting, visit: http://www.ievolveconsulting.com, or send an email to YouRock@iEvolveConsulting.com.
Purpose. Process. Propel.