In This Episode:
- How Jordan Gill used data and experience to set competitive prices for her business operations firm
- Why she focused on serving seasonal service-based businesses and how that impacts the way she delivers her service
- The stat she used to figure out a new way to offer her services
- What expenses Jordan accounts for in pricing her unusual offer
Is your business financially sustainable?
The answer to that question goes beyond how much revenue your business generates, how much you charge for your products or services, and or even how much you pay yourself.
We tend to fixate on those measures of financial success because they’re pretty objective. I can check my P&L and spot how much revenue came in last month or last year. I can pat myself on the back for raising the prices on my offer. And I can enjoy a healthy salary or bask in my profit distribution…
But none of those numbers really capture the financial sustainability of my business as a whole—and that can mean I might miss out on the opportunities for future growth or impact.
In Episode 325, I defined financial sustainability as having a revenue model that supports the business’s operational evolution and the financial needs of the people involved.
Let’s unpack that a bit.
Your business’s revenue model—or your business model—is the system that you use to create, deliver, and exchange value. In other words, it’s what you sell, how you deliver it once it’s sold, and what you charge for it.
Now, we often measure this sort of “in the moment.” Is the revenue model working right now? Is the business generating enough to cover my own pay and the business’s expenses? Am I working too hard today for the paycheck I’m getting tomorrow?
Obviously, you want your business to work right now.
But if all we ever do is set up our businesses to work right now, then we’re missing opportunities to build margin and resilience into our businesses for the future. Plus, we’re having to continually go in and recalculate–which creates the sort of precarity that leads to burnout.
So maybe your revenue model is working today. But will it work tomorrow?
As your needs and the needs of the business evolve, will the revenue model be able to keep up?
I can almost guarantee you that your next financial opportunity comes from taking a longer view on your revenue model.
I’m in the midst of this with a number of business owners right now. Taking a short-term view has helped them get their feet under them and find an impressive level of initial success! But now they’re feeling squeezed just trying to figure out how to eek out a little more growth.
For me, the key here isn’t to consider what a little more growth could look like—that shorter-term view. But instead, to consider what a lot more growth could look like and take long-term view.
Consider that your long-term, higher-level growth opportunity is rarely a matter of doing more. It takes a long, hard look at each revenue stream and weighing whether it can adapt to hold its weight in a business generating 2 or 3 times more revenue than it’s generating right now. And whether, if it can, the operational or personal expense of growing it to that level is worth it.
Let me give you an example of what I mean.
Imagine you have a 1:1 consulting or coaching business. You work directly with clients to help them achieve their desired results.
Eventually, you’d like to create more flexibility for yourself so you want to spin off at least 50% of the revenue you generate from client services and instead bring that revenue in through a more leveraged offer–say, an online course or workshop or group coaching program.
So you start putting on your thinking cap and see if you can make something like that work. You make an offer here and there and things start to add up. You can see how maybe, just maybe, each of those offers can add up to letting you take a step back from client services.
But you also notice that building, marketing, and delivering those offers is a LOT of work. The operations for that kind of revenue model are new to you and they’re demanding quite a bit of your time and energy. Maybe you hire someone, maybe you try to keep doing it yourself.
And by the time you realize you might be able to reliably swap out those offers for your 1:1 work, it’s abundantly clear that 1:1 work is more financially sustainable because it requires so much less of you & the business operationally.
Look, I know this is so counter what you’ve heard from business coaches and marketers. But it’s an experience that so many people have had and burned out on.
Can you navigate a financially sustainable way to moving from 1:1 client services to more flexible, leveraged offers?
Yes, of course. And here’s how I would do it.
Instead of figuring out what stack of offers is going to supposedly add up to the revenue you’re generating from client services, put your effort into figuring out what 1 offer is going to be able to eventually grow into a revenue stream that can replace what you’re generating now.
Don’t figure out how to generate $10,000 at a time with multiple offers. Experiment with ideas that you can imagine growing to $100k of revenue or more. You’ll still have to try some things out–and it’s likely that the journey will be a little windy and involve some backtracking. But you’ll have a much longer-term view of your business’s financial sustainability in the end–and that is going to feel oh-so-good.
Now, this kind of thinking still applies no matter the field you’re in or the business model you’ve built til now. If you want the opportunity to grow your business, you need to think about long-term financial sustainability–not just what’s working right now.
To take this point home, I want to revisit a conversation I had with Jordan Gill, founder of Systems Saved Me, in 2019. Jordan found herself in a position that’s familiar to many service providers; she was trading dollars for hours and the path to growth just wasn’t clear.
So she started to pay close attention to how her clients were actually using her services and considered how she could bring them an experience that would actually create better, longer-lasting results.
After considering the possibilities, Jordan found her opportunity. She shifted her business model away from hourly client services to results-oriented VIP days. She created a more financially sustainable business by finding a way to make the numbers add up without adding MORE to her workload or burden the business’s operational sustainability.
You’ll hear all about that—plus how she decided on pricing and how this shift has impacted her personal sustainability in this conversation.
So let’s find out what works for Jordan Gill!