Podcast 97: How to Set Your Holistic Business Income Goals
Dec 30, 2021
As practitioners, we’re small business owners and need to earn money to survive. Do you set yourself a revenue goal each year – the money you want your business to earn?
If not, you’re going to be drifting along with a vague idea of what you need to survive – this year it’s time to change tactics.
Personal income
Your business needs to be generating enough income to pay you a wage and you need to understand what you need to earn from it to make it viable.
Work out the following figures:
- What’s the minimum you need to earn personally to live?
- How much do you need to earn to live comfortably?
- What do you want to earn to have an amazing life?
When you write down the figures, how do they make you feel? If it’s uncomfortable, you’re on the right track. It’s about stretching yourself to start earning the living that’s right for you.
This amount will be different for everyone - it’s getting to the level where you feel financially secure, and have the resources to live the life you love.
Whilst the second and third figures may not happen in the next year, it gives you amounts to work towards to create a sustainable business for yourself. And knowing them means your brain is working away in the background figuring out how to make it happen.
Note: Remember to allow for any tax you need to pay here too.
Business costs
When you set your revenue goals, you need to take into consideration how much it costs you to run your business. There will be monthly costs such as mobile and internet, but you will have annual fees too such as professional fees and insurance.
Your business needs to cover all these costs on top of what you want to earn personally. Keeping a reference of these costs to help you manage your business expenses and understand where you’re spending money.
Ideally, you need to build in a buffer here too. Being in business is a rollercoaster and having cash in the bank will be welcome for any unexpected bills. What would be a good amount for you?
Setting your financial goal
Taking both your income and business costs into consideration, how much does your business need to earn this year?
Work out the different totals as this will help you understand your needs from basic to flourishing. Now based on where you are in your business, set your goal for the year.
This will be different for everyone; you may want to earn enough so you can leave your day job so you could set the minimum income goal. You could be in a position where you’re surviving and want to get comfortable, or you’re looking to step it up and flourish.
Knowing this figure will assist you in working out what you need to do to achieve it.
Break the figure down
It’s one thing having an annual goal, but what does this mean to you and your business at a month-by-month level?
Breaking it down into months and then again into weeks and days will help you to understand what’s possible.
So, for example, if you wanted to earn £36,000 a year – your income breakdown would look like this:
- £3000 per month
- £693 per week
- £99 per day (7-days a week)
- £139 per day (5-days a week)
- £231 per day (3-days a week)
You will have to build in allowances for holidays, seasonal highs and lows etc., but this exercise will help you to understand what it will take to earn what you want to.
Reality check
This will help you to put things into perspective – you need to work out how you will achieve the income you’re looking for.
There’s no point in setting an income goal if you have no way of knowing how you will achieve it – it’s just a dream.
Based on your figures, work out what you must sell to achieve them:
- How many services or products to achieve your goals?
- How many client appointments do you need to sell?
- Do you have the capacity to offer this many?
- Do you have enough products to sell?
- How does this compare to what you achieved last year (if you’re already working)?
- How does this knowledge affect what you do next year?
- Do you need to put your prices up?
Start asking yourself if this is achievable, and how you can make it achievable.
Planning to Thrive in 2022 – Saturday 8th January 2022
Join me on Zoom for one day and let’s get 2022 planned and ready for you to thrive.
You’ll create your personalised plan to keep you focussed for the rest of the year, so you know where to direct your efforts.
I’ll help you identify the right marketing activities for your business based on you, your values, your strengths, and your available resources.
The day will be practical and interactive with a comprehensive workbook/planner to complete which will guide you through the rest of the year.
Places are limited to 8 so you’ll get personal feedback and the opportunity to connect with like-minded practitioners and support each other.
So, if you want to get a great start to the year, join me - find the full information here
Podcast 97 show notes:
- (01:14) Personal income
- (03:24) Business costs
- (05:41) Setting your financial goals
- (06:34) Break the figure down
- (08:00) Reality check
