The last couple months have been pretty tough and while we’re not out of the wind yet…I’m sure you’re getting sick of all of the recession posts out there. Don’t worry this isn’t going to be one of them!
Instead of continuing to focus on the current situation I think it’s time that we shift our mindset and start looking at the future and what can we do better next time so when the next pandemic, earthquake or attack from Mars happens again, we’re in a much better situation than this time around.
At Fit For Profit we want you to be prepared for anything that may come up…the good and the bad. What if one of your kids got sick or you got sick? What if you won some crazy contest and want to move to an island? Maybe your business scales overnight and you have no idea what to do with all of the extra money? Some of these ideas might be a little crazy to imagine right now but the point is…we don’t want to prepare you for catastrophe, we want to prepare you for anything.
I know, I know, you probably knew this bullet point was coming but honestly let’s be real for a minute. Our clients who fully embraced the Profit First method, the ones that drank the Kool Aid and fully committed are weathering this current recession better than other clients we have that are sort of half in half out, dragging their feet and don’t believe in the process.
The beauty of the Profit First system is it sets your business up to be running efficiently so even when the next recession hits or some other personal life change you’re prepared for anything. The strategies you’re seeing out there for recession proofing your business are just normal day to day stuff to Profit Firsters.
Sometimes the idea of hiring someone else to do a task we hate gets us so excited that we just go a little hiring crazy. Or maybe we have some extra money one month so we start purchasing a bunch of luxury items we won’t be able to afford consistently each month. Do your members really need the lavender purple hand soap with fresh toilette at each sink or will a hand air dryer work with some antibacterial soap? Do you really need to get the super premium Stars, HBO, multiple upgrade package or can you just get away with basic cable for each of the TV’s on the gym floor?
When you take a hard look at your operating expenses all year round and are disciplined to only spend a certain amount, you will be more prepared for anything life throws at you. So before your next purchase think…do I really need this?
You may have hit a time in your business where everything was looking great and you had more than enough money rolling in. I call it getting complacent and it is something that every business owner like yourself does from time to time. I understand how it happens and don’t blame you for taking a break and riding your wave of success.
However, if you truly want to bulletproof your fitness business, you are going to need to get creative now and in the future. What other streams of income can you create or keep going?
So many of you were forced to move online in mid-March, some of you had wanted to do it for a long time and kept putting it off and quarantine was the deadline you needed. Others of you jumped in without having done any research and are learning there are people out there who like it just as much, if not more, than your brick and mortar. How do you feel about it? Can you keep some sort of online membership going (it’s good to have in your back pocket for next time) or maybe it’s time to add a nutrition program?
After all, you should always have more than one income stream for your business to be successful and I recommend focusing on the ones you know will offer you the most bang for your buck. You may want to create a couple different options at first and then turn your focus on the one that gives you the biggest ROI, or return of investment.
You can also be creative with your operating expenses. Maybe instead of hiring a fitness trainer, hire an intern. We have one client who has an amazing internship program with a local university – it’s a win-win-win! Not only do you save money, you help someone hone their skills, while learning a few new things yourself at the same time!
Emergency funds are not just for your household expenses. Your business needs an emergency fund too. When you work with us at Fit For Profit we’ll come up with a customized plan for you and your business to determine just how much you need to have stashed away.
If you need some quick numbers though, the suggestion is usually three to six months of operating expenses saved depending on how much revenue your business is generating each month.
Just like with your car, you never know when you’re going to get into an accident…that’s why we have car insurance. The same applies to your business. You never know when the next catastrophe, life event, or lottery win might happen. Following Profit First is the insurance for your business.
You can plan for any type of catastrophe or main event ahead of time, so you are ready if and when it does occur. It might be too late to do anything for your business during the current recession so instead focus on preparing for the future.
I recommend that you start utilizing the ideas I mentioned above and if you need help, book a call with my team so we can help you bulletproof your business. It’s not going to be easy, but a few changes can have you surviving and thriving long into the future.
Shannon has been consulting with small businesses for over 10 years. After 2 years in public accounting she saw a need to work for small business owners to teach them how to grow financially healthy businesses. She has built on her Master of Accountancy degree from Manchester University by becoming a Certified Profit First Professional and a Certified QuickBooks ProAdvisor. When she’s not meeting with entrepreneurs or assessing their businesses, she enjoys time with her husband and 2 children serving in their community, playing and watching sports, marveling at nature or reading a good book.
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