Archive for May, 2012
Over the weekend I met up with another small business owner and we got chatting over a few beers. He was slightly depressed about the state of his business, and that fact in the last two years he had seen no growth. Nothing. Zilch. Zip. His turnover and profits for 2011 and 2010 were almost identical to 2009.
This made him nervous, because everybody was talking about growth. New customers, new was of selling, new products, new price structures – grow, grow, grow was the key messages he was seeing. To stay static was to stagnate and die.
If your business is static – I congratulate you. If your 2011 figures were the same or even close to your 2009 figures – well done. If you are doing the same work as two or three years ago – have a beer to celebrate.
Right now, the world is in a pickle. Regardless of whether you are in the USA, Europe or anywhere else in the world, the economic picture is not so good. Greece is about to go bang, Spain will follow, which will hurt (maybe kill) the Euro, which in turn will hurt the US dollar, which will infect China and Japan.
The future looks bleak, but the past has been just as bad. The last four years have been just painful for most companies, people and countries. Cutbacks, no credit, recession – its been bad.
So if you are managing to stay static (both in your personal finances and in your business)– good for you.
After all, you don’t need to be taking steps forward when everybody else is taking a step backwards.
This can be far from ideal, and I often find myself sandwiched between Alison from accounts and Malcolm in Marketing (*names changed to protect the innocent).
Now whilst it can be good to rub shoulders with other people (saves going stir crazy at home), one of the problems that a busy freelancer can face is the distraction of office talk. Who is going out with whom, what happened at last night’s party, and what happened in the program that was on TV last night.
All of this can be very distracting when you are desperate to complete a project and get the invoices raised.
One solution of course is to plug in some headphones and code/write/design to the sounds of your favourite tunes. But sometimes concentration is required, so having the Spice Girls tell you what they really (really) want can be equally off-putting.
Sounds of Nature
So let me suggest to you, the sounds of nature. Rather than having 9-inch nails, Nirvana or Girls Aloud screaming at you, why not drift away with natures ‘white noise’.
As I type this, my ears are filled with the pleasant sound of surf on a tropical beach. There are birds in the distance, the sound of the breeze stirring trees– it’s all nice. It is calming, soothing, blocks the sounds around me, and best of all, it does not distract from what I am doing.
It’s a perfect solution. And you don’t have to stick with the sound of waves. Rain (with thunder) is great, as are the wild animals of Africa or crickets in the grass – there is lots of choice.
Give it a try – for FREE
Want to give it a try? Well I am providing you with two 20 minute tracks for free (from a copyright free source) – one track of the surf and one track of the rain – both are very good. Download the free natural audio tracks here. (zip file containing media files – about 57mb)
Going One Step Further
If like me, you find that your concentration levels go up when listening to the sounds of nature, than I would also direct you to a site which offers very high quality and very good nature sound collections (reasonably priced). Listening Earth is an Australian small business formed by a Husband and Wife team, who travel the earth recording (and photographing) nature. Their downloadable CD collections are what I now listen to whilst working – they are very good.
And I am all for supporting interesting small companies such as these, regardless of what they do as a business, or where they are based. Recommended.
I have a confession for you: for the last couple of months, I have been having a real struggle to make both my company current account and my own personal account balance. At the end of both March and April, I have really come close to running out of money. For instance in April, I only had £12 left over in my personal account from the start of the month to the receipt of the April pay cheque.
But you know what…. I love it. These two months have caused worry, caused stress, and at times it has caused panic. But it has been really useful.
Broke By Choice
The reason I have been really stretched over the last two months is because I made a choice to stretch my finances. My company income is the same as it always was (good), my pay (from my company to myself) has been the same, and I have not had to deal with any massive unexpected bills. Yet still I made a choice to be broke.
You see, over time, I have found that money has become surreal. I happily pay bills on behalf of my business which would make me flinch if I were paying them personally. And with my own personal money, I have spent more this year on big ticket items (holidays, electronics, etc) than any previous year. My own view of money has become warped. Money is a tool, and its value (to me) has reduced over time.
How and why I made myself broke
First, let me say that I didn’t really make myself or my company broke. I didn’t just wake up and give my money away to strangers on the street corner or start burning notes. Instead, at the start of March, I changed a number of standing orders to investments to be a lot higher than I could really afford. When I say I could not afford these overpayments, that would be putting it mildly.
I paid a lot more into my pension, transferred a lot more into my various savings pots, transferred more company cash into bond accounts and generally took a lot more out than was going in. But because they were all transfers into investments, I wasn’t really throwing it away – I was just investing a lot more.
But the effect was the same; I was making the amount of cash ‘available’ a lot less than the previous 12 months. And of course that meant that I didn’t have enough to pay my bills. Which was the point of the exercise.
It forced me to take a long hard look at all the money coming out of my personal and company bank accounts, for bills and salaries and frivolous activities, and forced me to really weigh up the value of the spending. Without the money available, there was no soft decisions – if it wasn’t paying its way, the payments HAD to be cancelled.
A great exercise for added value, and working out Real Value
I guess I could have just gone through an exercise (as I do now and again) and reviewed my outgoings, but that would have been too easy. I could have looked at my various magazines subscriptions and decided, that yes, I did enjoy them and they would have stayed. But with the money gone, a hard decision was needed. Four out of my five different magazine subscriptions were cancelled to help with the balancing.
Services my company subscribed to were looked at in cold terms. If I really could not live without them, they stayed (some reduced in payment terms through haggling) whilst a lot more were cut. It was a busy review period, but now my payments are a lot leaner because of it.
I am going to keep my overpayments to my investments at the new inflated rate for the next couple of months, and will then reduce them slightly (to bring back 1 or 2 items that I miss). But the exercise has been really useful.
By taking away the money I need to pay for the frivolous, superfluous and ‘wanted’ (rather than ‘needed’) things, I have saved myself around 25% extra over the last two months. Plus, my money management is back on track and I have weeded out a lot of padding.
It has been a useful money exercise that I would recommend to anyone.
For me, I love reading blogs by other freelancers, marketers and small business owners. Some can lead to advice and ideas which I can directly link to growing my business. But whilst I like reading blogs, I never let the blogs get in the way of my normal day job. Reading blogs for me is an activity reserved for when I am waiting in a queue, or on a train or erm, busy in the smallest room.
I also find myself reading a blog, understanding what the author is trying to say, thinking to myself that “that sounds like a reasonable idea” but never acting on it. I must have read hundreds of posts which caused me to take no action (for whatever reason). I am sure you are the same.
Well, rather than waste any more of your time, can I present to you a list of some of my action suggestions?
Any one of these actions (and associated posts) cover changes I have made in my own business. Each and every one of the suggested actions has grown my revenue, customer base and profits.
Pick one or try them all – I promise all will boost your business.
Ditch your accountant and go Cloud Based I wasted so much money on my accountant that in hindsight it scares me. Since moving to a cloud based accounts system, I have more control, more visibility, and I am saving so much money.
Get Your Terms and Conditions in Order. I know it does not sound sexy, but I know that having a straight forward, short but good set of T&Cs has landed me business whilst boosting my own business protection.
Be Bold, and Ask for the Business. I am a strong believer in asking for what you want (after all, nobody is a mind reader). I have won a lot of business simply by asking for it.
Set Goals. Your business needs goals in order to give it direction and something to aim for. Setting ambitious business goals has really helped me move forward
Reuse your previous work. This is one of my best tips for generating more revenue (cash) each and every day. Try it – you will be amazed!
Add communication and Control through Cloud Project Management. I have been using a cloud based project management system for the past 2 years and it has saved me so much time, effort and money. And my customers love the visibility it gives them. Perfect!
Streamline reading blogs and other content. I have moved reading content onto my mobile devices – and it means I can squeeze more productive time into the day. Free and Easy.
Keep the cash flow by Chasing Customers. My accounts system automatically chases overdue invoices with different levels of warning – which means I no longer have cash flow worries.
Offer a Bonus. And as my bonus suggestion, I recommend any serious Freelancer or Small Business Owner read The Wealth Freelancer – its packed with a whole lot more useful ideas for growth.