Last Wednesday a major event happened. I sold one of my companies.

 

I didn’t sell it because I was tired of running my business.

 

I didn’t sell it because I was in debt or financially unstable.

 

I didn’t sell it because I wanted something new.

 

I sold it because I built this business with a plan that one day it would provide a substantial nest egg for our family. I knew from Day One that in order to sell this company it would need accounts receivables and financials that warranted a serious price tag for my buyer and his banker.

 

In every decision we made over the last eight years, we considered this possibility.

 

I thought about it when I bought equipment and chose not to overspend.

 

I thought about it when I mapped out my packages and built hundreds of thousands of dollars in accounts receivable {that’s just invoices that we’ve sold and haven’t been paid on yet}.

 

I thought about it when I changed my pricing and grew my profit margins substantially.

 

I took emotion out of my decisions because in the end, I knew that this business was part of a much bigger plan for my family. I made decisions based on the numbers first and my dreams at a far second. And, on Wednesday, I confirmed my decisions were right, when I looked at my bank account and saw peace—peace in the future; peace in the ability to do less work because I had a nest egg; and peace that I could live the life of my dreams.

 

Whether you’re building a practice from the ground up or you’re years in, you can start building a saleable business. But, there are three things that your buyer {and their bank and appraisers} will want to see in order to complete the sale at your dream price.

1. Net Profits: Gross Income – Gross Expenses = What You Actually Make, otherwise known as Net Profit. For your buyer this means looking at two very important things:

Is this business making as much money as it could be making?

Is this business spending more than it should be?

 

Let’s start with Gross Income. I think we all know our business has left something on the table. Maybe we could add another program, become better at sales or increase our prices. From a buyer’s perspective, they’re going to wonder why you didn’t make these changes, which could result in a much lower offer.

 

So take off your owner eyes for a moment. Right now, what could dramatically increase your sales? Is it packaging for long term income? Is it hiring a sales manager to draw in new business? Is it learning Facebook ads and building a funnel of new clients? If you were buying this business today, what’s the first thing you would do to bring it to the next level?

 

Gross Expenses are one of my favorite things to dig into when I look at buying a business. My number one reason for turning down businesses that are offered to me is always an inflated rent.  So take a good hard look especially at your rent, your salaries, and your software expenses. What would a new owner do to get these expenses in check? What would they not tolerate—is this something you should let go of and alter now? Do you have a fear of change?

 

When you take off your {probably slightly overwhelmed} owner’s shoes, you can see potential. Then it’s only a question of making the decision to do it!

 

2. Gross Receivables: Every time someone signs a contract with you promising future payments, you build Gross Receivables. For a buyer, this means your business has guaranteed income in. For a buyer’s bank, the higher the Gross Receivables, the better investment a business is.

 

So what happens when all you sell is a single session, a pre-paid package, a month of services? You eliminate the possibility of Gross Receivables.

 

For your business, this isn’t good—you personally have no guaranteed income.

 

For your buyer, it’s even worse. They’ll have to hope that they keep as many of your clients as possible to warrant a high price tag. Their question will be: Are the clients there because they are loyal to the business or to the business’ owner?

 

Chances are it’s a little bit of both. But, you can resolve this by simply building packages with long term income. And, trust me….you won’t complain when July hits and you have another great month!

 

3. Business Infrastructure: Is your business running steady with a great, well-built team that has clear systems they operate under? Or is it in constant chaos, filled with last minute decisions, no clarity and zero direction as to what comes next?

 

The fact is, the greatest value my company offered was in its systems. They were exceptional. I only walked through the doors a few times a year.

 

I had great hiring systems, which enabled me to build a 7 Figure Team that grew my business for me.

 

I had great compensation systems that kept my team motivated.

 

I had great sales systems that were easy for my team to learn and grow my revenue {and their paychecks}.

 

I had great customer systems that kept our clients going strong and our profits compounding.

 

For that new owner, they knew they could walk into a business that was running strong and just keep the current systems rolling on ahead. No major effort. No hard work. Just keeping the status quo.

 

Out of these systems what do you need help with today? What needs to change? And, how will you ultimately build them?

 

What do you need to do today to build a saleable future? My friend, there is nothing better than seeing what you’ve built and knowing that you can sell it for great profits in the end. It truly is a beautiful thing!

If you want to dig a little deeper into how to prepare your business for sale {just in case the day comes you are ready!} click here for my Selling Out in One Year checklists and workbooks. Don’t be scared by the 19 pages… this is all the steps we took over the last year to sell our business for amazing profits!

Click Here to Download the Workbook

About once a day I get an email, Facebook message or text asking me, “When should I add  _________________ to my business?”.

 

Maybe it’s adding a Health Coaching Practice to your Pilates or yoga studio;  an acupuncture service to your chiropractic practice, or a nutrition program to your functional medicine practice.

 

Maybe it’s a smaller change.  I want to add Pre-Natal classes to my studio, I want to offer a fascia release technique.  I want to offer a new line of products in my businesses.  It’s totally complimentary, but a new element.

 

This is a great {and ridiculously important} question with huge potential.  In our businesses we’re always growing and our offerings should reflect that, but for me, the bigger question is “Is this the best time in my business to add ___________?”

 

I, for one, get bored easily.  A new product, a new service, a new certification…SIGN. ME. UP. TODAY.  The problem is that I can find myself with a shiny, new tool in my businesses arsenal, that’s filled with products that never really maximize their profit potential, while I burn myself out on constant creation and expensive marketing.

 

This is not a place I ever want you at.

 

So, let me share how I decide if it’s the right time to add a product to my business:

 

1. Do I have enough time to execute this flawlessly?

 

If you’re trying to offer a major new service without a serious amount of planning, you’re setting yourself up for failure.

 

It’s not just the time a certification or training takes.  It’s the time away from your current profitable part of your business that it takes.  It’s researching your market, building a client profile, incorporating this into your offerings, and deciding on a final price.  It’s taking the time to become a real expert in this {while running your already busy business}.

 

For me, this means I book a lot of these types of ideas a year out and I don’t do this every year.  I prize my sanity way too much.

 

To satisfy the consummate student in me, I dig in deeper to what I’m already building a business in.  So ask yourself this today, “If I dedicate the 40, 50 or 60 hours that this new program will take, and redirect that time into becoming an even greater expert at my current service, what would that do for my business?”.

 

I think you might be surprised to learn it will satisfy your creative urges, while giving your clients even more of what they want.

 

2. How much is this going to cost me?

 

When I ask this question, I normally get a one-sided answer.  The certification cost $2000.  The marketing will only cost me $350 because I‘ll be emailing clients.  I’m so excited to do this that I’ll feel like I’m on vacation, so it won’t actually take any of my work time.

 

While these answers are part of the truth, none of them really show you the true coast of adding this to your business.  So let me give you a quick list of what you should calculate:

 

Certification Cost

Any travel costs related to certification

Any apprenticeship costs related to certification

All print marketing costs {including new cards, flyers, posters, and materials}

All digital marketing costs {including new web pages and Facebook graphics}

How many hours of time you will invest in this certification and the hours to master it MULTIPLIED by your current average hourly rate.

How many hours you will take away from clients MULTIPLIED by your average hourly rate?

How many hours you will take away from your family, free time and white space to make this happen MULTIPLIED by DOUBLE your hourly rate {because this is your most valuable time}.

 

Now just review this.  There are times in life when we work a little harder to reach the next level.  But, these times can’t be all the time.

 

Have you left room for downtime in your life?  Have you impacted your financial wellbeing of your business?  Are you putting yourself in unnecessary debt to make this happen?   Is this the time to sacrifice or to release into where your business currently is?

 

3. Is my top tier product performing flawlessly and maxing out it’s profits?

 

If this answer is NO, then your timing is wrong.

 

So often when our main business isn’t working perfectly, we start searching for another answer to make more money, bring in more clients, keep people excited about our business.

 

This is the quick fix, that may change our numbers for one month, but does absolutely nothing for our long term.

 

Before you change, add or build anything, you need to make sure your existing business is thriving.  If not, I promise you’re leaving a lot of money on the table.

 

Let me give you a great example for our businesses.  We work with lots of athletes, so building an athletic training program was a great idea.  When we offered this the first time, we spent almost $700 on marketing, hours on programming, and our employees time on creating a fantastic program.

 

We didn’t sell one single package.

 

I have to admit, I wanted to scrap this program.  I had too many other items doing too well, I felt like I had wasted our money and I had no desire to make a mistake twice.   But, this wasn’t’ the best answer.

 

Instead, we surveyed everyone who had been interested and learned how they’d heard about the program, what they’d loved about it, and why they hadn’t purchased it.  I quickly learned we hadn’t sold any programs because our times were wrong for the athletes we were targeting, parents were nervous to enroll because coaches hadn’t jumped on board and that our marketing needed to get far more specific.

 

We re-opened the program three months later, in the Fall of 2014—new times, five coaches fully prepped and marketing that was spot on.  We sold 14 slots and got this program off the ground.

 

In the Spring, this program expanded to almost 40 kids and in the Summer we jumped to 88 athletes.  This Summer we are projecting just over $63,000 in revenue from our athletic training program.

 

Are you making this leap because you’re trying to fix  a bigger picture problem in your business?  Or are you making this leap, because your other programs are running so flawlessly that you have more than enough time to build something great?

 

If you want to dig a little deeper into how to prepare your business for sale {just in case the day comes you are ready!} click here for my Selling Out in One Year checklists and workbooks. Don’t be scared by the 19 pages… this is all the steps we took over the last year to sell our business for amazing profits!

Click Here to Download the Workbook

Picture this. You walk up to an appointment for a massage that you’ve been so excited about.

All you’ve heard is how amazing this therapist is, how every muscle in your body is about to be rubbed within an inch of it’s life and that you will walk out of this appointment feeling like you’re two inches taller.

But, the front porch is covered in old trash. One door is painted bright red and the other is neon orange. The paint on the doors are chipped and you’re not even sure which door is the way in. The hanging sign is turquoise and tilted, but the sign on one of the doors is green and looks ten years old. The windows are filthy and you pretty sure you see spider webs. At this point, you’re not even sure you want to walk through the door no matter how incredible this is supposed to be.

What do you do under these circumstances…or even more important, what does your client do if this is what they saw?

In this day in age, your literal front door comes far secondary to the front door your clients are going to first see—your website. This is your client’s first impression and trust me when I tell you, they are looking at this closely to see if you’re a good fit for them.

When we evaluate businesses, websites are often the biggest indicator of their overall new client success. A carefully branded, wonderfully laid out site that really speaks to a client experience absolutely generates business. But, that’s rarely what I see. Instead I see dated sites that are a combination of hodge-podged branding, old information and schedules and way too much information that’s not relevant to the customer.

Fixing your website isn’t as simple as clean it up because chances are in six months it’s going to look close to where it is now. Instead we need to start at the root of the problem {Which is your overall Branding} and then make adjustments page by page.

So let’s rewind a step and let’s look at a simple question: What is your brand?

Your brand is a combination of who you are, why you’re in business and, most importantly, what your attitude is. Your brand will look extremely different if you’re a yoga studio catering to hard-core athletes, a chiropractor catering to children or a massage therapist catering to the elderly. Your brand is as unique as you {and your very boutique and personalized business} is.

So let’s start with a few questions….

If I asked your top five clients to describe your business’s attitude was what would they say? How would they describe the uniqueness of your business in comparison to similar businesses?

Does your current brand match this in its:

• Logo?
• Fonts?
• Color Scheme?
• Images?
• Videos?

These five items combine together to create your Brand Identity. You can think of your brand identity as individual personality traits of your business. If one trait is off kilter, it throws the entire brand. And, Brand Identity is so important to your customer as it’s going to trigger a feeling within them…it’s literally meant to tell them they belong in your company.

About 90% of Brand Identity issues comes from having more than multiple designers creating inconsistent portions—one logo here, totally different styles of images there, color schemes that vary from your website to your marketing to your Facebook ads {if this is your business, you know exactly what I mean}.

So to get our Brand Identity in check we need to rewind and find one common theme.

1. Start with a great designer.

This is not the time for Fiverr, 99Designs or your cousin who’s getting their graphic arts degree and wants to practice. You will be taking their work and incorporating it into your website, brochures, emails, client agreements and every form of marketing your create that attracts clients. Don’t skimp. If you’re unsure where to start, UpWork can be a great resource. One word of advice: We have found the cheaper the rate on UpWork the more intense project management you will likely need. Look intensely at portfolios and be sure that they’re producing the kind of work that makes you go wow.

2. If you use multiple designers, have them meet with one another.

I’ve learned from experience to have my presentation designer meet with my graphic designer who is always meeting with my web designer. Everyone is on the same page and building the same brand. Even ten minutes over Skype can prevent chaos.

3. Create a Brand Design Guide.

Your primary designer should create a Brand Design Guide which includes your colors, your logo, and major graphics. Ideally it will describe that attitude and Brand Identity you’re seeking in all materials you have created. This guide needs to be provided to anyone who is creating materials for you so you have complete consistency. Just as an FYI…my design guide is one page long. I don’t have Anthropologie’s budget or 200 pages of branding requirements. It’s simple, but it works to keep me totally in line.

4. Branding costs less than you think.

A phenomenal website and branding guide should run between $2500 and $4500. Don’t get sold on too many fancy hosting fees, monthly SEO charges and “done for you” blog posts. Just get the design right without breaking the bank. As you grow this can grow with you, but until you’re bringing in your dream salary and beyond, stay simple and keep that money for your salary.

Where is your brand today? Does it need adjustments or is it exactly where it needs to be? We’ll be featuring some of our favorite brands over the next few months, so if you think your company should be featured email us at support@lisekuecker.com and tell us why you’ve created your branding and how it’s helped build your following!

The phone call started like many with my clients.

“I just need more clients. I want to be overflowing…waitlist capacity and ready to burst.”

Now, I love waitlists and the idea of overflowing schedules. But, I like knowing how many clients I need to achieve my goals even more.

And, this number is easier to figure out than you could ever imagine.

So let’s start with “How much you need to earn?”.

Yes, I know you have all the hours in the day you can fill, but frankly, I want you to enjoy your life. And, if you’re charging for the unique, high touch service that you offer, you’re not going to have to work 40, 60 or 80 hours a week. You just need to fill the right amount of hours that earn you the right income.

Then let’s add in your Average Client Monthly Value. And, yes, this number can fluctuate wildly based on how you package and price your services. Consider our client Erin. Her ACMV jumped from $86 to $266 in a three week period just based on her new pricing and packaging. Yes…that’s tripling what each client is worth to her business.

Your Average Client Monthly Value can be found by taking your Total Monthly Gross Revenue and dividing that by the Total Number of Active Clients {these are clients who have been in in the last thirty days}.

Now, I love my ACMV. My goal is to keep it as high as possible. And, the fact is, when it’s high I need less clients to meet my financial goals and I can service them so much better.

In the first week of January, I asked you to come up with what you needed to earn. Ideally, this is a number that’s more than just paying your bills. It’s where you can genuinely say, you are excited when you write yourself a dividend or paycheck. So what is the dollar difference between where you are today and where you want to be?

Once I have that dollar amount, all I need to do is take my Needed Income and divide it by my Average Client Monthly Value. This is the exact number of clients you need to add to reach your goals.

If you’re like me, it’s kinda nice to have an actual example…theory is lovely, but visualizations are even better.

For the sake of my math brain {which moves slow some mornings}, let’s use some large whole numbers.

Last year, Suzanne earned $70,000. She recognizes that she could live the lifestyle she’s really wanting if she earns $90,000 a year. That’s a $20,000 difference.

Last year her Average Client Monthly Value was $200.

But, Suzanne has repackaged and priced her products so that her customers come on a more regular basis and are billed monthly and her new Average Client Monthly Value is $500.

To determine how many clients we need we’ll take Suzanne’s $20,000 difference and divide that by $500 leaving us with 40 clients Suzanne needs to add in 2016.

40 clients may still seem like a lot, but once we know this number we can start making a real action plan to find these ideal clients. We can plan our marketing, how we’ll work with existing clients to drive new business and even what packages we want to sell the most of {bonus if this drives your ACMV up higher}.

Once you’ve taken the mystery out of what you need for success, actually reaching it becomes a whole lot easier. So, how many clients do you need to reach your goals? And, what steps come next to get you there?

With Grit and Gratitude,

Lise