041 Make it Work or Make More Money: How to Scheme in Business
Host Regan Bashara teaches you how to scheme in business. This is her concept to teach entrepreneurs how to determine if they can afford to make a purchase or take on additional expenses in their business. And if they can’t yet afford it, or “make it work” right now, she teaches you ways to use your current offers or create new offers to make more money in the pursuit of your financial goals. This concept of scheming will be part of the entrepreneurial course, Mind the Gap, coming in 2024!
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Welcome to Money Through Ease. I'm your host, Regan Bashara, founder of All Ease Accounting. I'm your numbers witch and bookkeeper. I'm so happy to have you tuning in today. If this is your first time tuning in, I would love it if you could please leave a rating or review of this podcast. Let me know your thoughts about it. If you've been listening for a while and you still haven't rated or reviewed, shame on you—just kidding. We don't shame people here, but if you could leave me a review, that would be amazing because I am trying to reach more people with these topics, with my work. I want to help entrepreneurs become more financially literate and empowered by their business data.
Last week, I talked to you about business retreats, and I told you on that episode that I was going to share what we did on my business retreat with my coach, and then I didn't. I completely left it out and I forgot; it just wasn't in my show notes, and then I forgot that I had mentioned that. So, this week I'm catching up on the activities that I did on my business retreat a couple of weeks back. I went to Kansas City.
We spent some time working on developing my digital course, "Mind the Gap," which, if you listen to my ads, you know what that is already. I expect to be able to release that course sometime in 2024. I got a lot of work done on the content of it. I also developed some marketing strategies that I can start implementing now to get to where I want to be by the time that course gets launched.
Things that I also did in Kansas City include taking a walk for my mental health. I woke up early on my second day there because I had gone to sleep very early due to my first flight out being at 5:00 AM on the first day, so I was very tired. I woke up super early the next day and decided to take a walk. It's a really cool city. I'd never been to Kansas City before (that's Kansas City, MO). I really have never been to the Midwest, and it was very nice. If you're a Midwestern person, shout out to y'all up there. I'm in the South; I'm in Louisiana. While the Midwestern and Southern cultures do kind of have some overlap, they are pretty different. So, it was interesting to see a different culture from where I live. The funny thing about Kansas City is that, of course, there are so many amazing places to eat, and there's all sorts of hotspots, and we ate so well while I was there. All the places we went to were amazing.
And it turns out that I ate mostly vegetarian dishes, which was entirely coincidental. I am not a vegetarian; I'm a happy meat eater. If you're in the Midwest or in the South, you're probably a meat-and-potatoes gal like me or a guy or a non-binary person. So, me eating vegetarian while I was there was coincidental, but it was so good. If you are somebody that likes to travel in America, specifically in the United States, and you've never been to Kansas City, I can actually highly recommend it. Very cool city, very intentional urban planning has happened there, obviously over the last couple of decades. Very cool spot.
I had a little bit of a mini panic attack on the plane ride to Kansas City, and just some things going on with my body. Sometimes I get a little too in my head, and then you know, you kind of start having phantom symptoms of whatever you imagine your body could possibly have going wrong. So, that was kind of happening. But I coached myself through takeoff and I breathed through it. And then as soon as we hit cruising altitude, I passed out, so I was good. But I don't know, I just figured I'd share that with you all because I do deal with anxiety, and I want you to know that if you deal with that as well as a business owner, you're not alone. I get it.
One thing that we did that was super amazing and unplanned was we visited the National Toy and Miniature Museum, conveniently located in Kansas City. One of my like social media scrolling hyper fixation things, like one of my favorite types of videos to watch is people making miniatures or designing what's called book nooks. A book nook is pretty much like a diorama that you used to do in middle or elementary school, really middle school maybe. And it fits on your bookshelf. It's like the size of a larger book, but it just slides in between your other books, and people decorate them to look like little forest escapes or, you know, little mini houses and stuff. Anyways, I'm just obsessed with watching those videos of people making miniatures and dioramas and things like that, dollhouses.
And when I mentioned this, my coach was like, "Oh, I know where we're going today." And it turns out that Kansas City has the National Toy Miniature Museum. And it was amazing. It was incredible. I took a lot of videos and pictures, and I will be making some videos with all of that slipped in. So if you also like looking at tiny things, please make sure you're going to follow me on my social media to watch those videos. It was super fun and amazing and just mind-blowing. They had a pair of fleas—like bugs, microscopic bugs—dressed up in tiny clothing, and you had to look at them through a microscope in order to see the detail on it. That's how tiny some of this stuff was.
Anyways, let's get right into today's topic. Today's topic is "You can either make it work or you can go make more money." This is specifically about whether or not you want to spend money on something for your business. So, this could be a business expense that you want to make in order to buy something and invest in your business, get a return on purchasing something in your business. This could be you wanting to purchase a piece of equipment that's going to help you produce more. This could be hiring a workforce—whether you need to hire one employee, you need to hire more employees than you have right now. This could also be you deciding that you want to start outsourcing certain tasks. You can outsource client work. You can also outsource admin work, things like social media marketing, your email marketing, bookkeeping—you know, all of these things that you can hire out an independent contractor to do. Maybe you want to do any of these things.
All of these require that you spend money on something for your business. Now, I don't believe that anything truly exists in a binary fashion like this—that you can either make it work or you can make money, and it's either-or, and if it's neither, then it doesn't exist. I don't think that's actually how the world works, but this is how I'm looking at it. You either have the ability to make it work right now (and we'll talk about what that looks like) or, if you don't have the ability to make it work right now, make that expense work for your business—AKA have the cash flow to support that. Or you can make more money right now so that you can make it work. Now, I don't think that this is a true binary. The other option would be choosing not to make it work, not to make the purchase, etcetera, but for the sake of this topic, let's say that you've decided no matter what, you're going to take whatever actions you need to do this thing for your business. So let's operate under that assumption together. This is the binary we're working with: either make it work right now or you go make more money so that you can make it work.
And we're going to take a quick break, and we'll be right back.
Also, y'all, this is just crazy to me that I'm on my 41st podcast episode, and I've actually done some bonus episodes in between there, so this isn't even my 41st. It's been more than that, but I'm just, like, so proud and shocked and proud, but mostly shocked at myself for sticking with it and to keep going. I have more things that I want to talk to you about and share with you. So, just a quick shout out to me that I'm on #41, and that's pretty freaking cool.
So anyways, our topic today is that you can either make it work in your business right now or you can go make more money so that you can make it work. And let's look at how you can make it work right now. So if you've decided that you want to spend money on your business, you have an expense that you want to make in order to get some sort of investment in your business. You have a piece of equipment you want to buy. You want to hire a workforce. You want to start outsourcing tasks to free up your time and your business. You've decided you're ready to spend some money. We need to figure out how much that is going to cost you. #1, let's figure out if you're going to pay for something full price right now and how that will affect the balance of whatever savings you have for your business, whatever cash reserve you've got in your business—so just cash sitting on hand. And what does your cash flow look like? Do you have upcoming payroll that you need to be concerned about paying other people and not spending all of your money on this one thing?
I have a story that I like to tell of a previous client that called me while they were test driving a new vehicle. They called me from the vehicle, and they were like, "Hi. Do I have enough money in my account to buy this today?" And I was like, "Technically, yes, your bank balance does have that money. However, you've got this many people on payroll, and we're running payroll next week. I recommend against draining your cash reserves for anything. I don't care how good it is, I don't care how shiny it is. I don't care what kind of features you've got going on. If you have people on payroll, especially, but all the other business expenses that you have on a regular basis, need to come into consideration when you think you just want to pay for something with cash."
So, if you know how much something is going to cost for you to purchase it for your business or to invest in your business, we need to also look at if you pay the full price of that thing right now, how will that affect what's in your savings? What's in your cash reserves in your bank account? What does your cash flow look like, and will this deplete that if you've got upcoming payroll and all those other things, right? How do we know this? How do we look at this? How do we evaluate this? We pull our financial reports—our profit and loss, our balance sheet, and our statement of cash flows. Those are the three reports that I recommend you look at on a regular basis, every single month.
But this is also what we pull when we want to evaluate whether or not to buy something, whether or not to invest in our business. That will really key us in to whether to pay for something in full with cash or if we need to use credit or rely on financing, or if we just need to go make more money. So #1, decide what you want to spend money on and how much it's going to cost. Then, pull those reports and look at paying for it in full price right now and how that would affect your finances. And then consider, are you going to pay for this thing on credit? Do you have enough available credit on a revolving line, like a credit card? Do you need to take a draw from a business line of credit? Will you finance this purchase and then have a monthly bill that you're now committed to before you pay it off?
All of these things need to be considered before you pull the trigger and make a decision. Once you've decided whether or not you can make it work right now, choose how that will look with one of the above options.
And here's the thing: You may benefit from shopping around if you're going to finance something or use credit. It might behoove you to look for some deals or find the best interest rate if you're going to finance it. If you don't have available credit, that is something that needs to be considered. You need to sit down and look at these reports because if you go to any bank and ask them to finance something for you, those are the reports they're going to ask for. That's how they determine whether or not you and your business can afford to finance something. So, pulling those reports first is going to arm you and empower you with the knowledge you need to advocate for yourself, to negotiate for maybe a lower interest rate, or to negotiate on the price of the thing. It's your money, your credit, your business—do what you've got to do. But having the knowledge of what your numbers say upfront will help you enter that conversation and decision-making from a much more empowered place, looking at whether or not you can make it work right now.
Like we said before, this is not a true binary, but I think the other option here, if you're sure that you want to spend this money and make this purchase or invest in your business this way, then the other option available to you is to go make more money right now. First, we need to write down how much money you would need to earn—either at one time or consistently on a regular basis moving forward—in order to accomplish this goal.
So, look at what your current offers are in your business and the unit price. What is the unit price? That means how much one person pays to get one thing from your business—whether that's a service package, a product, or a combination of those things. Like, what are you selling basically in your business? What's the price of that one thing? One thing that is the unit price. So, we're looking at what you're currently offering in your business and its unit price. Do you offer your services in a package, or do you offer one-off services? Maybe you do treatments, etc. Do you sell products? How much does each product cost? Let's get these numbers down on paper so that we can start doing some calculations.
If we know how much the thing is that you want to buy, to invest in your business, or if you want to hire somebody, you're outsourcing things—whatever money you need to spend that you've decided you want to spend for your business. We're going to take that total amount that you need at one time, or if this is an expense that you're going to have for your business on a recurring basis. Like, you're outsourcing your bookkeeping. That is typically a monthly bill.
If you need so many dollars extra per month to afford to outsource your bookkeeping, we're going to divide that total amount that you're needing to make more over what you're already making, and divide that by the unit price of one of your offers or all of your offers. See how many you need to sell of each product in order to reach your goal.
Here's an example: If you need to make $1000 one time, and this is for a one-time expense or purchase (let's say you need a piece of equipment that costs $1000), and then what you sell in your business, your unit price is $10, then you need to sell a hundred of those in order to accomplish your goal. You've taken the total amount you need for one time ($1000) and divided it by your unit price of $10. That gives you 100 units to sell to reach your goal.
Here's another example: If you have a monthly goal of making an extra $1000 and you are now and you have a current offer that is $500 a month.
Or maybe it's $500. Then you need to sell on average 2 per month or have two recurring customers per month to meet your goal of $1000 extra dollars a month. It's very simple math. Don't get caught up in it. Take your time. Listen to this again if you need to and walk through it. Write it down and you will see how many things you need to sell – how many widgets or how many units. This is the total number of offers that you need to sell to accomplish this goal.
That is going to be our plan. We're going to establish that plan to sell that many offers, and here it may be useful for you to know what your conversion rate is. Conversion rate just means how many people need to interact with your business in order for you to make a sale. So if you have X number of people come into your store or visit your website and half of those people complete a sale or order something or hire you, then your conversion rate is 50%. Half of the people that interacted with you bought from you, and so knowing that you need to have twice as many people come into your store or visit your website in order to sell the number that you need for your goal.
Your strategy now is to bring in twice the number of people that you need to sell to; this conversion rate also works if you provide services. So essentially, your conversion rate looks at how many people you need to interact with your business based on how many you want to pay you money. Once again, it's simple math. Write it down. This is the basis for going out and making more money. If you can't make it work right now with your credit, or with your available cash or savings, money does not grow on trees, and I know that that's true, but there are actions that you can take that will lead you to your next customer or your next client and so on.
So if you truly want to purchase something in your business or you want to hire an employee or you want to outsource your social media marketing, there are steps that you can take to make that goal a reality. If you quote-unquote "can't afford it" right now, see step one about how to make it work. You can either make it work right now, or you can go out and make more money right now in order to make it work. I hope this process was helpful to you.
I believe many business owners often feel confused or unsure about where their next clients or customers are coming from. They see these individuals as the solution to their current business problems, particularly when it comes to not being able to make things work right now. However, that's not the case. You are the solution to your clients' or customers' problems – their pain points, their suffering, their desires, or their needs. Don't expect them to solve your problem of not being able to achieve your own financial goals.
If you found this episode helpful, please leave a review and share your thoughts. I'd also greatly appreciate it if you could pass on this episode to another business owner. It’s my goal to reach more entrepreneurs and help them to run their businesses more efficiently and in pursuit of their own goals. Thank you for tuning in, and I'll talk to you next week.