Start 2017 with Some Inspiration

I love reading this poem.  And with Arnold Palmer’s passing this year, it seems fitting to read it and remember a great athlete and successful businessman—who of course, went to Wake Forest.  Because so many successful people do.

I hope reading it inspires you.  Cheers to a New Year and a time to take your business to the next level!

 

Whether You Think You Can or Can’t You’re Probably Right

If you think you are beaten, you are;

If you think that you dare not, you don’t;

If you’d like to win, but you think you can’t,

It’s almost certain you won’t.

 

If you think you’ll lose, you’ve lost;

For out in the world you’ll find

Success begins with a fellow’s will.

It’s all in the state of mind.

 

If you think you are outclassed, you are;

You’ve got to think high to rise;

You’ve got to be sure of yourself before

You can ever win a prize.

 

Life’s battles don’t always go

To the stronger or faster man;

But sooner or later the man who wins

Is the man who thinks he can.

 

*A plaque has hung in my office for many years carrying the above selection of free verse.  I am not aware of its origin, but consider it a pertinent guideline for one to pursue in life and toward specific goals as well.  It has always provided an energizing thrust to my career in golf.

-Arnold Palmer, Professional Golfer

4-1, The Edge: The Guide to Fulfilling Dreams, Maximizing Success and Enjoying a Lifetime of Achievement, Howard E. Ferguson (This is one of my favorite books. So many great quotes and bits of inspiration.)

 

I Made a List of 20 Things I Should Be Doing: What Happened Next?

Back in August, my business coach, Mary Ann, suggested that I create a list of 20 things that I should be doing.  I made that list and didn’t really think twice about it after we discussed each item.  It’s now the end of December.  See how many of those things I’ve completed or am actively working on without much extra effort…it’s kind of amazing!

20 Things I Should Be Doing

  1. Networking.  I have attended a few business group lunches since November and have made some great contacts.  I’ve also been trying to spend more time with friends in general.
  2. Create a business plan for 2017 for both studios before the year is over. Include sales goals, advertising, marketing, events, clothing purchases, etc. Done!
  3. Create a monthly advertising budget and spend it towards advertising. I just started some new advertising and finished a draft advertising budget for 2017.
  4. Reach my savings goal in the Pure Barre savings account. Achieved on December 7th!
  5. Set up 1 additional savings account for monthly deposits that will pay annual Federal and State taxes. I don’t like to give the government an interest-free loan, so I wait to pay all of my taxes until the end of each year.  I have plans to open this new account when I get back from vacation in mid-January—and I’ll pocket the interest.
  6. Set up 1 additional checking account for monthly clothing purchases. I am probably not doing this anytime in the next 30 days.  But it will happen at some point in 2017.
  7. Get business line of credit. It’s smart to get a line of credit when you don’t need it.  This is one thing I kind of forgot about, but I’ll be working on this in the next few months.
  8. Look into a paperless system without having to print receipts. I looked into this and I think we’ll just stick with our current system of printing receipts.
  9. Create a plan to ensure we continue to have a great Pure Barre Team culture—is there anything else we could be doing to improve our culture and the Team’s satisfaction with working at the studio. I have some great ideas to start in 2017!
  10. Set up an office and keep files organized. Half-done.  I need to make a trip down to The Container Store in Charlotte to get some furniture and storage solutions.  If you’ve never heard of The Container Store, you’re welcome.
  11. Get a mileage app to record business driving. I have not done this.  If you have any suggestions, let me know.
  12. Get more involved with the charitable organizations that are important to me. I have donated money to The Forsyth County Backpack Program and the Wake Forest Deacon Club.  But I would like to spend time volunteering at the Backpack Program.  I’ll have to work it into my schedule. 
  13. Develop meaningful business partnerships. I’ve had some great meetings with other local business owners in the last few months.  I’m excited about a Pure Barre Pop Up class we’ll have on Tuesday, January 24th at Bevello, a women’s clothing store in Winston-Salem.
  14. Look into acquiring another studio. I have made several calls about this and know the process as well as how much money I would have to contribute to finalize the deal.
  15. If I’m not teaching or working at a studio event, stop working at 6:00 PM. I was doing really well on this one until December.  I’ll have to get back on track in January.
  16. Take 2 days off each week to rest and recharge. Epic Fail.
  17. Plan 2 vacations a year that are at least 1 week long each. I just went to a Christmas lunch at a local travel agent’s office so I’m inspired to start planning!
  18. Make plans to learn 1 new thing each month. I’m sure I’ve learned at least 1 new thing each month regarding my business.  But I meant for this to be about leisure activities.  I really want to learn how to fly fish and I want to start rock climbing again.  I’ll have to actively work on starting these activities.
  19. Start writing a blog.   Done. Obvi.
  20. Buy a house. This is a top priority in 2017!

As we head into 2017, what if you made your own “20 Things I Should Be Doing” list?  How many of them do you think you’d complete over the next year?  How much better off would your business be if you started making a few small changes?  I’m going to keep better tabs on my list and I’m looking forward to checking off all of the items I haven’t yet completed!

In my next post, I’ll leave you to celebrate the New Year with some quotes on goal setting from one of my favorite books, The Edge.

 

Until then, stay on your toes!

Loving My Nespresso Aerocinno Milk Frother

I had no idea that making a better cup of coffee or espresso at home was important to many of you!  It seems we all want to save some money, as suggested by The Compound Effect, and skip the Starbucks line or drive-thru by making coffee just as tasty at home.  If you missed my first post about this subject, check it out and start brewing ASAP.

But I have some new tricks up my sleeve when it comes to frothing milk—my Nespresso Aeroccino4 Milk Frother.

My Team got me one as a gift and all I can say is, this machine makes amazing foam!  If you’re able to spend the money $119—or receive as a gift, like I did—get yourself one and start frothing away.

Share the Milk & Cookies

At my last Growth Club meeting, we discussed a book called The Leadership Secrets of Santa Claus.  In the book, Eric Harvey, talks about sharing the milk and cookies.  Meaning, you need to reward your team for the hard work they do.  Even though you, the business owner, are in the spotlight, it’s important to recognize the people working behind the scenes.

Agreed—when your team meets goals, it’s imperative to celebrate and recognize everyone’s contribution.  But, then I started thinking…what about sharing the milk and cookies with local charities?  How important is charitable contribution to developing the culture of your business?

According to the U.S. Small Business Administration, about 75% of small business owners donate some portion of their profits to charitable organizations.  I think that’s incredible—that’s hundreds of thousands of people giving back.

Through my two Pure Barre studios, I support two local charities that are important to me, The Forsyth County Backpack Program and the Wake Forest Deacon Club.  Are these donations important to developing the culture at my studios?  I think so.  Here’s why:

The Forsyth County Backpack Program

This is an incredible organization working to combat the problem of food insecurity in children in Forsyth County, North Carolina, which includes Winston-Salem.  Unfortunately, Winston-Salem is ranked one of the worst cities in the nation for families with children reporting food insecurity and 50% of Winston-Salem Forsyth County school children receive free or reduced-price lunch.  What is even more disturbing is that despite all the wealth and opportunity in Winston-Salem, about 25% of all children are food insecure—meaning they don’t know when or where their next meal is coming from.  Many of these children only eat at school.  So, when they go home for the weekend, they aren’t eating until they get back to school on Monday morning.  The Backpack Program creates “backpacks” or bags of food for these children in need of food that they can eat and prepare for themselves on weekends.

I don’t have children, so you might wonder why I’m so passionate about giving money to the Backpack Program.  I am a huge believer in the American Dream—that anyone can be anything they want as long as they work at it and have a plan.  I also have a problem with the idea of wasted talent.  It is extremely bothersome to me that a child could not be reaching their potential in school or in sports because they aren’t eating proper meals.  So, through Pure Barre Winston-Salem and Pure Barre Clemmons, we’ve donated $3,000 this year to feed children in Winston-Salem.  The Backpack Program is extremely efficient and $20 feeds one child for a month, so we’ve helped about 12 children for the year.  I’m really proud of this and hope we can contribute even more next year.

Wake Forest Deacon Club

It’s really hard to be a student athlete.  On top of attending classes, you also have hours of practice sometimes several times a day.  When I swam in college, I had 2-a-days and weight lifting as well as a full course load to manage.  Sports breads the same mental toughness that is required of entrepreneurs.

A college education, especially at Wake Forest University, is expensive.  I was extremely fortunate to have grandparents who paid for my undergraduate education, which meant that I didn’t have any student loans when I graduated.  Being debt-free gave me a lot of flexibility in choosing my career path and accepting my first job.  The Deacon Club provides scholarships to Wake Forest’s student athletes and if my money can help them leave school with less debt or no debt, they will be able to make better career decisions—and maybe even start their own business.  Go Deacs!

While my business Culture Statement doesn’t explicitly include charitable giving as a value, giving back allows us to build connections through fitness, strength and a supportive Pure Barre community.

I’ve made it a priority to support these two organizations because they are important to my business culture.  The work they do is also an inspiration to me.  I look forward to sharing the milk and cookies!  I hope you and your business are fortunate to do the same this holiday season.

Tomorrow, I’ll have another bonus post about how I’m enjoying my new Nespresso milk frother.  And next week, I’ll let you know what happened when I wrote out a list called “20 Things I’m Not Doing but Should Be.”  I’ll also leave you to celebrate the New Year with some quotes on goal setting from one of my favorite books.

Until then, stay on your toes!

Why I Stay Organized with The Day Designer

I love technology.  Anything that can make my life easier or more efficient and eliminate paper and clutter is tops in my book.  Except…my planner.  I tried to embrace my iCalendar.  All the syncing and the iCloud was great, but I was missing appointments or showing up late—A LOT.  And the constant alerts were kind of annoying.  I also had to carry around a separate notebook of “to dos,” ideas and events.  So, I went back to the planner.  But not just any planner, Whitney English’s The Day Designer.

There are several other brands of planners out there and you should check them out to see if they might work for you.  I have determined that the Erin Condren is a little young for me.  If I was in college, it might be perfect, but I’m a business owner and need to carry around something a little more sophisticated.  The Simplified Planner by Emily Ley was a little closer to what I was looking for, but it is more focused towards new moms or moms with young children, of which I have none.  But check them all out…because it’s most important to find something that works for you and use it to help make your life more organized.

Back to the Day Designer…I love The Day Designer.  You can get a version of it at Target, but if you’re serious about keeping your schedule, goals and “to-dos” organized, you’ll want to spring for the Flagship Edition ($59).  If you amortize that across the year, that’s less than $5.00/month to keep your schedule together—totally worth it, if you’re as busy as I am!

But it’s the layout of the planner that is what I like best about it.  Each day gets its own page starting at 5:00 AM and finishing up at 9:00 PM—perfect for me because sometimes I have to teach an early class.  The appointments are on the left and the “to dos” are on the right, so your whole day is right there on one page.  There is also a spot to prioritize your top three “to dos” which is always helpful when you have lots to accomplish in limited time.

In the spirit of setting goals that you’ll actually work to accomplish and taking risks in 2017, take a look at how you schedule yourself and keep yourself organized.  It’s that one small change that can have a big impact.  Maybe switching to a paper planner, like The Day Designer, will help you out.

What is Your Inaction Costing You?

It really bothers me when someone brings up the word “risk” in a negative way.  Since when did taking a risk turn into something bad?  I just Googled “risk definition” and got “a situation involving exposure to danger.”  Really?  Seems a little extreme.

Starting a business is pretty risky.  Ordering day-old sushi involves a degree of risk.  Hell, getting married is pretty high up on the risk ladder (there are some really crazy people out there).  But are you really putting yourself in harm’s way or exposing yourself to danger doing any of these things?  Ok, well maybe ordering the sushi.  And I am reminded of an amazing story involving a co-worker, a vehicle in a home garage and a crazy ex.  But, isn’t risk just a situation involving a degree of multiple outcomes, or UNCERTAINTY?

As business owners, it’s our job to assess risk, by looking at the possible outcomes, developing a plan or strategy to achieve the best outcome and executing that plan—thus mitigating the risk.  It’s also our job to not freak out if things don’t go our way initially.  If you’re a good leader and manager, you can solve any problem that arises.  Or better yet, have your team solve some of those problems for you.

Taking risks isn’t a bad thing.  In fact, for small business owners it’s a necessity.  You took a risk opening your business and now you have to take some risks to grow your business.  So why do we seem to put off taking risks?

We over-worry                                                                                                                        

You know you do it—when you think about taking that one big risk (or even a little one), you start to over-worry about all the things that could go wrong.  You start saying things like “I can’t, because…”  Instead of thinking of risks as dangerous or bad, try thinking about all the opportunities that you might gain.  It’s easy to focus on the negative side of risk.  But what about all the positives that come from risk-taking?  Oh yeah, those.

We jump straight to “No”                                                                                                              

I’m 100% guilty of this.  In fact, it might be my process.  If someone has an idea that is out of my comfort zone, I immediately say “No.”  Then, I start to think about it.  Is it really such a bad idea?  What is so bad about it?  Why do I hate this idea?  Ok, I really don’t hate this idea.  Could I change anything about it to make it a good idea?  Ok, maybe it’s not such a bad idea.  In fact, it’s kind of a great idea—with these changes.  Ok.  Let’s do it.

Why do I jump straight to “No”?  I think there are three phases of a business.  When you first start your business, you’re in the “Yes Phase.”  You say “Yes” to everything because you either don’t know any better or you’re afraid to say “No” and offend people.  Eventually you get burned from saying “Yes” all the time and you move solidly into the “No Phase.”  The “No Phase” means that people ask you things and you don’t even think about it, you say “No” TO EVERYTHING.  And you don’t care about offending anyone.  And it’s awesome.  But after a while, you start to think, maybe some of these asks might actually be good for my business—now you’re in the “Maybe Phase.”  You hesitate to say “No” right away.  But you sure don’t say “Yes.”  In the “Maybe Phase” you evaluate each ask and scrutinize everything to ensure it makes sense for your business.

You can’t skip phases or rush them.  Still in the “Yes Phase” and miserable?  Don’t worry, eventually you’ll move over to the “No Phase” and start enjoying life again.  I’m starting to dip my toes in the “Maybe Phase.”  But I’m not ready to cannon ball just yet.

We don’t calculate the cost of doing nothing                                                                          

This is probably the most over-looked aspect of risk-avoidance.  There is an actual cost (in $) for not taking risks in your business.  Sure, it’s risky to spend money advertising or offering a new promotion—but if you do nothing what will that inaction cost you?

For instance, I could spend $3,000 plus the cost of the actual ads (another $1,000+ on running the ads each month) to hire someone to help me create a Social Media advertising campaign and bring new clients to my Pure Barre studios.  For me, that’s not an insignificant amount of money to spend on one method of advertising.  But how much revenue could I generate from running these ads?  I estimate that the year-long value of one new client who signs up for our Pure Barre Platinum package is more than $2,000.  You can see that the potential gain is pretty good compared to the risk of spending all that money up front on something new.  If I can just get a few new clients to like Pure Barre and take class for a year, I’ll pay for this new ad campaign.  And what if I actually tested each ad to see how people were responding?  Then I could stop running an ad that didn’t work or change it to see if that improved response.

If you’re hesitant to take a risk, it’s important to ask yourself: “What am I losing by my inaction?”  There is a cost for doing nothing.  If you don’t act, your competition will.

So, what risks will you take in 2017?  Will you continue to view risk as dangerous or bad?  Or will you decide to think of taking risks as a means to new opportunities?  Think about it.  I’m sure there is one thing you know you should be doing right now, but you’ve been putting it off.  Take that risk and see what happens.

I mentioned that the one word that will describe my businesses in 2017 is “GROWTH,” so I’ll be taking lots of risks.  I’ll also be evaluating each decision to make sure my business realizes a profit from those risks.

I have some bonus posts this week about why I use the Day Designer to keep my schedule organized as well as a new gift I received, a Nespresso milk frother.  And I’ll also be discussing the importance of giving back—and not because it’s a tax write off, although that is nice.

Until then, stay on your toes!

Set Some Goals for 2017

There seems to be many schools of thought on the concept of goal-setting.  In The Compound Effect, we’re taught to focus on making small changes for a big impact.  I’ve also read a few articles suggesting setting goals beyond your reach is the way to go, because you’ll always be working towards something.

This post is not about the right or wrong way to set goals.  It’s simply advocating sitting down, deciding on some goals and putting a plan in place to achieve them.  I know that setting small, achievable goals works for me because now it’s propelled me to make some larger more complex goals, however, you need to evaluate what works best for you.  Remember, hope is not a plan.  You have to plan to get results and effect change in your business.

In my last post, I discussed how I set quarterly goals—three to be precise—and also establish a reward for myself if I complete all three.  So here are my goals for the first quarter of 2017:

Improve my retail marketing and develop an inventory strategy

In addition to having Pure Barre classes at my studios we also sell workout clothing and accessories.  I’ve always focused my marketing efforts on attracting clients to the studio for the sole purpose of taking class.  Well, not anymore.  I’m going to start marketing Pure Barre Winston-Salem and Pure Barre Clemmons as retail clothing stores.  So even if you don’t take class, you’ll want to come shop and check out our amazing apparel.

It’s imperative to test and measure to make sure your plans are effective.  I’m going to track my inventory turns and margins more thoroughly.  At this time, I don’t keep any core items (like that one amazing pair of black leggings) in stock.  I’ve always focused on having new things arriving all the time.  I’ll have to evaluate if it makes sense to have core items or if my existing buying strategy is working.

 Grow shesonhertoes.com

I started this blog because I’m really passionate about my businesses.  But I also want to write a book.  Blog – > book.  This one will probably take me more than 90 days, but I’m sure I can figure out how to get some more followers at the very minimum.  Wanna share this post with all your friends and help me get started?!  #shamelessplug

 Create a passive income strategy

A passive what?!  Passive income—you know, income that just shows up at your door repeatedly with little effort on your part to keep it going.  Is that even possible?  It sure is.  And if you haven’t looked into it, maybe that should be one of your goals too.

As of right now, all of my income comes from Pure Barre.  It’s important to diversify by adding additional income streams, like real estate (rent), investing in high dividend stocks or direct marketing.

Ok, so I’ve got my goals.  Time to just get crazy and get them all done!  Not so fast…I’m not going to start working on these goals until January and it will take me the full 3 months to get them accomplished.  In order to set myself up for success, I’ll have to sit down (this weekend) and come up with 5-10 strategies to get each goal complete as well as how I’m going to test and measure my progress and success.  That’s right, I’ll want to quantify each goal.  With like numbers.  Yep, actual numbers.

And now for the best part.  After I complete all of these goals, I’ll give myself a reward for the achievement.  It’s important to make the goal something that will motivate you and also make it specific—so you might want to think bigger than just going out to dinner.  By March, I’ll have accumulated a whole bunch of American Express points and I’m going to use them to purchase a bracelet.

Have you set your goals for 2017 yet?  Start small and focus on 1-3 things that you can get done in the first 90 days of the year.  Write your goals down along with your 5-10 strategies for completing them and then test and measure to see how you’re doing.  If you make goal-setting a habit, where do you think you’ll end up by this time next year?!  Something tells me you better crank up the ‘ole laptop or grab a pen and paper and get started.

In my posts next week, I want to discuss the important topics of taking risks as well as giving back and letting others benefit from your success—tis the season of giving after all!

I also want to tell you about how I stay organized with my planner, the Day Designer, as well as an update on milk frothing (seems that y’all were very interested in learning how to make great coffee at home).  My team gave me a fabulous present—a fancy milk frother—and I’ve been perfecting my use of it for the past few weeks, so I’ll share the wealth on that one.  You’re welcome!

Until then, stay on your toes!

 

What’s the One Word that will define your business in 2017?

Each quarter I go to a day-long seminar called Growth Club that is organized and presented by my business coach, Mary Ann, and her colleagues at ActionCOACH.  Growth Club is designed for business owners to take a day away from working in their businesses and focus solely on what their goals are for the next quarter.  It’s also a great chance to meet other business owners, learn about what they are doing, and get their perspective on any problems you might be having.  I usually walk into Growth Club needing like eight coffees and leave with wings on my back.  And by the time I get home, I’m exhausted thinking about all the things I need to plan or add to my “to do’s” to take my business to the next level.

At last week’s session, Steve, a coach in Greensboro, asked us: “For 2017, what is that one word that will be your mantra?”  For me, it’s GROWTH.  But only for my business, not my waistline (I own 2 fitness studios, so I should be good on that one) or the number of dogs currently under my care (3, 2 English bulldogs and 1 dog that thinks she’s a bulldog).

Now that I’ve spent the last seven months hiring an incredible Team and ensuring they are working together as a team, it’s time to focus on all the ways I can increase the sales at each of my studios.  In other words, it’s time to develop a marketing strategy and any additional sources of revenue—basically, the fun stuff.

There are several ways I can grow my business:

  1. Open another studio.
  2. Acquire another studio.
  3. Grow the retail side of the business—ie. sell more clothing.

Which am I considering?  Well, all three of course.  When you’re looking to grow your business, you want to be open to all of your options and then pick the one or ones that make the most sense.  Keeping in mind that all growth options should adhere to the definition of a business which is: A commercial, PROFITABLE, enterprise that works…WITHOUT YOU.

I’m excited to see what 2017 has in store for me, my Team and my two Pure Barre studios.  What’s the one word that will be your mantra in 2017?  Think on it and then develop a plan to reach your goals!  Remember, your competition is waiting until January to come up with their goals.  As we say at the studios: “There is never a ‘perfect’ time.  Today is the day.  Start now.”

In my next post, I’ll discuss my three goals for the first quarter of 2017 as well as some specific steps I’ll take to reach those goals.  I have learned that when setting goals, you need to have a reward at the end and there’s jewelry at stake here!  So, these goals will be reached!

Until then, stay on your toes!

 

No MBA, No Problem: How to Measure Your Business Financial Performance

But what is financial performance anyway?  Every industry has its own benchmarks, metrics and ratios which can tell you about how a business is performing.  For small businesses, financial performance indicates how well you are investing your capital (or cash) and generating revenues.  In addition, you’ll want to keep track of your bottom line to ensure you are generating profit, which is simply what is left after your expenses.  So, you’ve got two areas of focus, top line (revenue) and bottom line (profit).

But…really you want to be laser-focused on the bottom line because you’d always want to increase your profit and would do so even without increasing your revenue.  These are pretty basic concepts.  Every small business owner knows that you want to keep your expenses minimized to maximize profits.  No MBA required.

What gets a little tricky is the concept of cash flow.  Cash flow is the net amount of cash coming into an out of a business.  You make money, you spend it.  No problem.  Well, not exactly.

My credit card processing company has a two-day settlement period, which means I have to wait two days to get my money from credit card sales deposited into my account.  And if there is a bank holiday on Friday or Monday, then I have to wait that extra day as well.  Pretty much all of my sales are from credit cards.  Does anyone carry cash anymore?

So…what if I need to process payroll, but I’m still waiting for money?!  That’s where you have to be smart and MANAGE your cash flow.  It’s critical to understand your expenses, when they occur as well as when cash comes into your account—hopefully they match up.  If not, then you need to make sure you have a cash cushion.  How big should your cash cushion be?  It depends on how large the gap is between when you have to pay cash out and when the cash comes in.  But for me, I like to keep at LEAST enough cash around to make one payroll and both of my rent payments—just in case.

I often think that I own and operate two separate businesses.  I do own two Pure Barre studios, but what I mean, is that selling our Pure Barre classes requires a totally different business strategy than selling workout clothing and apparel.  It’s like I have two separate businesses under one umbrella.

I bring this up because when measuring the financial performance of your business, it’s important to look beyond the grand totals and actually break down each separate area of your business.  You might find one business area is incredibly profitable, but another actually sucks profit away from the first if managed improperly.  If you simply looked at the total, however, you might not realize the need to make changes to improve.

You might be wondering what makes selling Pure Barre classes so much different from selling clothing?  Cost of the sale in relation to the revenue—or margin.

For example, the cost of having a class really is just what I’m paying my teacher to teach the class.  Super high margin.  And as an added bonus, all of the clients taking the class have paid in advance of experiencing the service provided.  Love it!

However, the cost of selling clothing is a little more involved.  First I have to pay for the clothes (cost of goods sold).  Then they ship (usually from California, which is about 1 week via ground shipping).  Then we have to enter them into inventory (maybe an hour, maybe an afternoon).  Then they get sold which sometimes happens right away if the clothing is really cute or there is anticipation built up to purchase.  But sometimes it could take as long as several weeks or a month.  Do you see the issue here?  I’ve already paid for the merchandise and by the time I sell it at a minimum I’m out that cash a week at the maximum over a month.  And even after I sell, I still have to wait an additional two days to get the money into my bank account.

This is where cash management really plays a role in the financial success of my business.  If I have to pay my bills with the revenues from clothing sales, I have to make sure it’s hitting my account in time.  Also, my vendors are trying to manage their cash flow as well so they usually send me my orders at the end of the month ensuring that they get to book their revenue when they need it.  This means I usually book the expense of buying the clothing in the month before I actually sell it.  Tricky.

How do I make sure that I have enough cash to pay my obligations?  I work to keep my reoccurring membership payments for classes equal to the amount of my payroll expense and my fixed expenses, which are the expenses I have all the time and won’t typically change, like rent, utilities, insurance or carpet cleaning.  If I keep all monthly reoccurring payments equal to my most critical expenses, then I won’t run into a cash crunch when I’m purchasing clothing.

When I evaluate the financial performance of my business, I’m looking at how many clients I have on reoccurring memberships.  I’m also looking at how fast we can turn our inventory.  And I’m keeping a close eye on any expenses that are larger than usual or not typical each month.  Evaluating each of these things ensures I am managing my cash flow and it stays positive.  Because after all, cash is king.  And I’m sure my employees wouldn’t be too keen on not getting paid or my landlords for that matter.

I’m heading to one of my most favorite days of the quarter, Growth Club, on Friday.  I’ll get to spend the whole day focusing on my business and setting my goals for Q1 2017.  Next week I’ll write about the importance of goal-setting AND rewarding yourself for meeting your goals.  I’ll also discuss my goals for 2017—if I write them down, I’ll be more likely to meet them!

Until then, stay on your toes!

Why I’m Opting Out of Black Friday

Each year it seems that the hype around Black Friday gets a little more aggressive and a little more outrageous.  Stores offer “teaser deals” to get you in early with the hopes that if you happen to get your hands on said deal, you’ll buy other higher margin items as well.  After experiencing four Black Fridays (I’ve owned my Pure Barre studios for over 4 years), I’m announcing that I am done with Black Friday.  Next year, I’m opting out.  Here’s why…

Dollar, dollar bills.

Keeping in mind that the definition of a business is a PROFITABLE enterprise that works WITHOUT YOU, I have to call it quits on Black Friday sales.

Before you make a decision about your business, you need to ask yourself: “Will this increase my profitability?”  And if the answer is “No” then why are you doing it?

During Black Friday 2016, I didn’t make any more money than a normal business day.  Ok, technically I made an extra $200 after I factored in the discounts and extra time paid to my employees for preparing and executing the sale.  Was it worth it to not go home to spend time with my family and wake up early for an extra $200?  Nope.  (After reading this, I’m pretty sure my mom is already planning my arrival for next year’s meal and I may have regained my status as most-favored daughter.  Sorry Becky!  Zing!  Just kidding! #wearentcompetitiveatall)

I challenge you to REALLY think about whether you made a profit from Black Friday.  Maybe you had a killer sales day, but did you make any money?  Remember, to succeed in business, or make a profit, you have to have a margin greater than the sales price.  For example, if it costs you $50 to buy an item at wholesale and you sell if for $100, you’ve made $50.  But if you put that item on sale at 50% discount, then you’ve made $0 because you just got $50 selling something that cost you $50.  And you’ve actually made less then $0 because you had to pay someone to work, as well as any marketing costs associated with that sale.

This was actually my most profitable Black Friday yet—and I have a whopping $200 extra to show for it.  In the past, if I’ve put clothing on sale, I’ve actually lost money.  This strategy is called “monetizing the asset” and simply allows me to get something…anything…for merchandise that isn’t selling, thus allowing me to free up cash to buy other items I believe will actually sell at full price.

If you need to free up cash to use for something that will be more profitable, then by all means, have a sale.  Sales can make perfect sense if you can use that money to reinvest in more profitable decisions.  But if you have low inventory or don’t need extra cash to increase your holiday inventory, stay strong and skip the deep discounts just because everyone else is.

It’s OK to be the best.

Look, at some point you have to just accept that your business is the best at what it does, and that’s ok.  I don’t feel like a jerk for saying that.  My team and I work really hard and we will never settle for being anything but the best.  My Pure Barre studios are what my industry calls “boutique fitness” studios.  Meaning, we offer a premium (the best) service in the Winston-Salem and Clemmons areas.  We are the barre experts.  Does the best have to discount?  No, they do not.

If you build your business to be the best, you are attracting clients that care about quality and aren’t price sensitive.  These people aren’t solely focused on chasing sales or trying to “get the best deal.”  They want the very best and recognize the value associated with getting it.

Of course, you have to make sure your prices make sense—and believe me, if they don’t your sales will suffer—but it’s such a drag to have clients who only care about the lowest price.  You have nothing to offer them if you’re competing on price alone.

And let me let you in on a secret.  If you build your business to be the absolute best in your community, it’s fun to keep getting better.  You won’t be spending time worried about how to cut prices.  Instead, you’ll be trying to figure out how to invest more in training your employees to be better.  You’ll be asking yourself how to make improvements to impress your clients and attract new ones as well as what you can do to innovate and “wow” everyone.  Who wouldn’t prefer to be solving those “problems?”

No sale will make up for satisfied clients.

We all know that the true test of a satisfied client is whether that person would recommend your business to their friends.  If your business plan doesn’t include getting referral business from your existing client base, no sale will make up for that lost revenue.  The best thing you can do for your business is to earn your clients’ trust and respect so they will tell all their friends about how amazing you are.

My business goal is to get every client who purchases our introductory offer, the $99 New Client Special, to then purchase Pure Barre Platinum, which is a 12-month contract priced at $139 each month.  In order to incentivize clients to continue taking class and make the commitment to purchase Pure Barre Platinum, we offer a free outfit including the client’s choice of leggings, a Pure Barre tank or tee and Pure Barre socks.

Are my clients more likely to be excited about a free outfit and tell all their friends how amazing Pure Barre is because we offer superior service and “wowed” them to keep coming into the studio multiple times a week taking the best classes?  Or are they going to tell everyone how amazing our Black Friday sale was?  Sorry, no question—the first one, of course!

And for those of you wondering if I lose money giving away an outfit, I’ll simply ask the question back to you.  What do you think?

I’ll leave the Black Friday sales to those big box stores that have to compete on price, because it simply doesn’t make sense for my business.  I will, however, start to brainstorm some more exciting post-Thanksgiving ideas that I think my clients will appreciate and more importantly tell all their friends about!

Next post is about measuring the financial performance of your business.

Until then, stay on your toes!