The Business Clinic Organisation - For Healthier Profits
Independent and thought-provoking, The Business Clinic delivers the strategy, skills and support you need to develop and grow your business
From lockdown to back to business, will we be going from pause to play or via restart?
I have spoken with many people in business recently and there is a very polarised view - many see the current situation as being on pause and when the government presses the play button, things will go back to normal. Okay, most people realise the back to normal will not be instant, but step-by-step back to normal we will go is their belief.
5 Books to Keep up Your Lockdown Self-Care and Boost Your Business Strategy
By Rebecca Allam
Lockdown. Day 171, week 52, I think it’s possibly the 32nd Mapril? Or is that just me?
Finding it hard to carry on as you once did while working from home, homeschooling, home drinking and board meetings from the comfort of your own sofa? I think it’s taking its toll on us all.
But for the immediate future, this is our new way of life, therefore as business owners, we must be resourceful and continue to search for ways to keep moving forward, whilst keeping our mental health intact.
Reading is a great way to relax, unwind and to feed the brain at the same time. So we have put together an excellent selection of books that come highly recommended to not only provide a great read but with the promise to build on your business knowledge and give you new skills to implement straight away. And they are all available to buy or download at your fingertips through Amazon.
Recommended to us by Consulting Practitioner, Nicola Taylor of Utility Warehouse. The Jelly Effect shows you ‘how to raise your game to a different level’ by showing you how to communicate effectively, not throwing information at someone, hoping that enough of it sticks (aka jelly).
This book helps you understand how to make yourself more approachable and engaging to the people around you - it’s straight to the point with a no-nonsense approach. Andy Bounds has produced an easy to read guide for anyone looking to improve the way they communicate in life. Yes, it is specifically applied to sales and marketing, but can also be considered for people who want to improve their communication in any other situation.
The most important part of this book may well be the ‘afters’… but you’ll have to read it to find out why.
Nicola’s review: I’d recommend this book because for me, it’s simple and the way Andy Bounds describes things and his attention-grabbing ways, makes communicating messages (selling or actions) easier.
So the idea of the jelly is that if you threw a bucket of jelly at someone, only some of it would stick – it’s the same with communication, only some of it will stick/stay so you need to grab their attention.
Also, Andy is partially sighted and there is genetic blindness in his family so he had to describe things to his Mum, hence he sees the world through a different set of communication eyes – plus if it works for big companies, it can work for the one-man-band too.
Recommended to us by Practitioner, Antony Haysom. You may well have seen Sinek’s 3rd most popular TED talk based on ‘Start with WHY’, which inspired people back in 2009.
Sinek’s book focuses on the elite of the business world - the Steve Jobs, Bill Gates and Elon Musk’s of the world and breaking down the reason why they command more success, loyalty and are more profitable than others. What do these people have in common? It’s all in the WHY behind it. The realisation that people can’t truly buy into a product or service, concept or idea without fully understanding the reasons behind it.
The one thing our business leaders of the world have in common is that they all think alike; act and communicate in the same way, and have the same passion flowing inside them.
Do you want to be a part of ‘The Golden Circle…’? Give this a read and see where the inspiration leads you.
Antony’s review: This book adjusted my thinking by challenging it. Challenging the long-standing thought process of life (which has thus far yielded not so great results) is so important. We need to grow, evolve and change as people if we are to become the person we need to be to achieve our goals in life.
It’s about focusing on and realising the driving force behind 'Why' we do something that can be revolutionary for the mind, life and those around us.
The 5 Levels of Formality – Danny Rich and Paul Robinson
This book, based on real-life events, follows the character of Sam Hirst on his journey through the highs and lows of network marketing, through to his success. Sam takes you through the 5 different levels of contact that all business owners should break their contact list down into before they communicate with them.
If you want to build your business and increase your confidence in how to approach potential customers and even employees in a way that feels comfortable to you, this might be the book you are looking for. Following a storytelling style, it breaks down business concepts into bite-sized, manageable chunks.
One reviewer wrote: “I wish I'd actually read it much sooner, would've saved a lot of time, confusion, anxiety and disappointment. I'd be much further on in my business if I hadn't left it on the shelf for 6 months. It’s a very easy read, clearly explained and I’ve learnt so much.”
Retention Point: The Single Biggest Secret to Membership and Subscription Growth – Robert Skrob
Recommended by Helen Livesey of The BCO. If your business is based on member subscriptions (and even if it isn’t) this book is a great quick and easy read and will give you insight on how to keep your customers engaged and on a path to becoming your advocates.
Robert Skrob reveals more than 25 years of membership growth experience in this new book. Retention Point will open your eyes to many ways in which you can keep and maintain great relationships with your customers and ensure they stay with you.
You are going to need a highlighter and pen when you pull this one out for a read!
Helen’s Review: Retention Point is written in a straightforward way. It is easy to take away points for development and simply identify the things you are doing well or that you can improve on. The food for thought areas for me were, ‘your relationship begins after the sale’, as well as ‘focus delivering transformation rather than information’ and ‘begin by promoting the end’.
Recommended by a fellow Shout Network member, Helen Spencer from Utility Warehouse, this book addresses the myth that all people who start a small business are automatically classed as entrepreneurs and therefore, understands how to take that business and make it a success, but even technical expertise and expectations can get in the way of running a successful business if taken in the wrong order. This book walks you through those steps, from infancy right through to entrepreneur, applying techniques used in franchising to any business, even if it isn’t a franchise.
It’s about being able to distinguish between working on your business and working in your business!
If you don't want to own a job, but want to own a business, this book will help you get into the right mindset.
One reviewer wrote: “This book provides the material to help change the mindset of any technician (be they in IT, bakery, floristry or any business) and offers practical advice on how to systemise your business.”
So, break out your reading glasses and glass of wine (if you are so inclined) and find that cosy place to sit and let the waves of knowledge wash over you!
Remember to always check Amazon if you have a Kindle, as sometimes books are on offer for free to download. (In fact, Retention Point is right now).
The Challenges of Pricing a Service
By David Nelson from The Business Clinic
Unlike product-based pricing, we cannot always quantify all the costs that go into providing our service.
Please remember our time is finite, we cannot simply buy more to put on the shelf.
The costs, expenses and overheads that go into providing a service are harder to pin down than those that go into making or buying and reselling a product.
In a service-based business, finding our target profit margin is not as simple. We do not normally have an original price of the goods or materials to use as a starting point.
Instead, we need a pricing formula for our services that needs to account for the intangible features of running our business, such as time and our value.
To make pricing work for a service business we need a service pricing formula to work to.
Because there is not a perfect method for pricing services, there is some flexibility. But we need to create and follow some set rules to create a uniform process to price our service:
• Understand the time we are investing • Review the market • Know our clients • Set our profit margin • Calculate our overheads costs • If charging an hourly rate or project rate, use the same core formula to price
Understand the time we are investing
Knowing our costs, competitors and business benefits should not be our only considerations when pricing services. The time we put into our business matters, it is finite.
Think about how much time we put in to (invest) in providing services. The longer we spend on a project, then obviously the more we should make.
We should keep track of the time going in to completing a service, this can be done manually or via apps or accounting solutions - it will not only help us come up with a fair price, but more importantly understand the time we are investing.
Also, consider our length of time in our industry. The more time we have clocked up, the higher the value of our experience and service we provide.
Review the market
What are our competitors charging for similar services? What is the demand in the market and is there under or over supply?
On its own, relying purely on market-based pricing generally is not a sustainable business model and it is the business that disrupts the status quo that keep ahead. We should not therefore base our pricing for services just on what competitors are doing. However, we should ensure we do know what other companies charge so our prices aren’t completely far of the mark.
Make sure we are comparing like for like, also look at associated things like payment terms, delivery terms (duration) etc. Be sure we are comparing like for like and not just taking a client’s word that the competition is charging a particular price. If we are completing our service in half the time with penalty clauses and providing 30-day payment terms, that is a very different value of service to a competitor providing a service with no penalty clauses, taking twice as long and working on 50% upfront and payment on completion.
Keeping an eye on our competitors’ pricing can help reveal what sets us apart. Our goal should be to charge more than our competition, not try to match or undercut, but at the same time show clients we are delivering higher value, otherwise it will always be a race to the bottom.
Know our clients ... what is our perceived value?
It is not what we charge that matters most, it is the benefit of our service to our clients that dictates the most. No matter how much you charge or how little, it matters not if our client is not willing to pay because the benefit to them does not match the price being charged.
We often spend too much time looking at the margin for us in a service delivery, rather than considering the benefits delivered to the client.
When providing a service, it is often saving our clients’ time. Remember to communicate how much valuable time we are saving our client.
Set our profit margin
Our profit margin is how much our business will be left with after taking the cost off. Having a target profit margin is essential, remember the incredibly old, but always true saying, “Turnover is vanity, profit is sanity”.
Like anything else important that we want to achieve, we should set a target - we cannot turn over a whole year’s turnover in one project (well, not in most normal businesses) so we should target this per project, so the annual target looks after itself.
Calculate our overheads costs
As a service-based business, our costs are going to be similar to a product-based business. We may not be stocking up goods on shelves or be manufacturing items, however we still spend money to operate/run our business.
Understanding the true cost of providing our services plays a major role in learning how to price our services.
Break down our costs into two categories - direct costs and indirect costs. Add together our direct costs and indirect costs to determine the total amount of money we must cover during a time period.
Knowing our costs is just a starting point for service pricing. Remember that we cover at least our costs to reach our break-even point.
Our direct costs are expenses that go directly into providing our services. Examples of direct expenses include:
• Direct materials – stationery, postage • Direct labour - ours or an employee used on delivering the service
Our indirect costs are expenses that we need to run our business, but we cannot attach to a specific project or client.
Examples of indirect cost, overheads include:
• Indirect labour - bookkeeper, admin, receptionist etc • Rent, rates and service charge • Utilities: heat, light, power, telephones, internet • Equipment and maintenance • Insurance • Marketing and advertising
If charging an hourly rate or project rate, use the same core formula to price.
Whether we should charge an hourly rate, a set retainer rate or a rate for the project can depend on many variables and sometimes this may be industry specific.
If working on a set rate, we cannot check if we are achieving the correct charge hourly and profit margin if we do not know how much time it takes us to deliver the service and the cost of those hours.
A pricing formula should follow these simple rules
A - Multiply 40 hours by the 52 weeks in a year = 2,080 B -Then deduct non-billable time - such as holiday periods, business development and administration time.
A-B = C - billable time Then calculate direct costs and indirect costs = D - total costs
Now divide C by D = E (our billable time by our total costs)
E - This will provide us with our break-even hourly rate
Lastly, add the target profit margin (F) to our hourly rate to provide the correct hourly rate to charge for the service.
E + F = G – Client’s price per hour
Per project rate
To come up with a per-project rate you can:
Use our hourly rate as calculated above and estimate how long it will take to perform the service.
Add the target profit margin and then charge the fixed price for each service, and don’t forget to track if the estimate of how long it will take to perform the service is correct before using the per-project rate again.
Cleaning tips to keep you busy at home...
If you want something to keep your mind off the crazy world we are currently living in, we can help you get your home spring cleaned to perfection.
These tips will give you the comfort of a germ-free home whilst using natural thrifty methods with equipment you can lay your hands on at home.
So put down the remote and get out your odd socks...
So you think you’re using the right social media platforms...?
By Rebecca Allam
Social media is something even the most tech-savvy business owners sometimes struggle with, the main reason for this? Time. Your time as a business owner is precious and you can usually find a better use for it either completing work for a current client or going out there to win some new ones.
From advice given at a previous surgery Nicola has created a presentation to deliver at a company conference in front of 1200 people sharing her experience and knowledge about networking.
The discussion point she brought forward was a research exercise to get some information from people who haven’t necessarily done a lot of networking in order to build her presentation to suit her audience. She found this exercise very useful and was able to build a personable presentation using only cue cards and her own engagement.
Here are some of Nicola’s 10 top tips:
1. Networking is about communicating regularly to people, with a purpose 2. Google networking events in your postcode, you will find lots to choose from 3. Have focussed, regular networking time built into your diary 4. If your feeling uncomfortable take someone else with you who is non-competing 5. Have a meaningful conversation with the people you have targeted from the delegate lists 6. It’s what you do after the event that counts – follow up, follow up, follow up 7. Don’t email everyone after the event if you haven’t spoken to them 8. Like dating, don’t ask them to marry you on the first date aka don’t ask them to buy from you straight away 9. Be you, people buy people 10. It’s a long game, not a quick fix – so be patient
Last week was National Storytelling Week and we asked people to write into us sharing their story and let us put the spotlight on their business to give you, the readers, a chance to understand that person better, get to know them in a different way and realise why they do what they do. Because lets face it we are all human and stories make us much easier to relate to and refer.
So first up to share was Consulting Practitioner Nicola Taylor..
Thursday 6th February 2020
In 2008 along came the recession, not only did it cause financial issues at home, because my husband was in the trades, we were also subjected to a huge financial loss due to a Spanish property. Our world was turned upside down, our house was in jeopardy, and everything was falling apart around us.
Having grown up in a family business until it was sold (that also fought off the recessions of the 70’s and the 90’s), where the work ethic was work hard, work evenings and weekends, do whatever it takes, but never rely on others or the state. You had to just take ownership and move forward... so we decided to move forward. Our goal was to help others avoid going through what happened to us. We wanted to share our story and to build a financial wall around us. We surrounded ourselves with positive people and helped others to do the same, and each day we move closer to our goal.
Unfortunately home finances are not taught in schools but are a really important part of life. Debt, or not enough money left at the end of the month can have a great impact on people’s mental health and wellbeing. It’s a frightening and lonely place to be. Now that we are partnered with a fabulous company and surrounded by helpful people (irrespective of background), the personal development journey and knowing that I can help people keep more money in their pockets each month is a true reward for me. And it’s even more exciting that now other people can have the opportunity to start to build their own second income stream and build their own financial future to protect their family, just like us, it truly is amazing.
Some of my favourite sayings that have kept me going are:
• “Don’t wait until you are thirsty to dig your well”.
• “The only thing standing between you and your goal is the B*ll@*1t story you keep telling yourself as to why you can’t achieve it”
• “If you’re absent during my struggle don’t expect to be present during my success”
This one is so true! The supportive colleagues, family and friends we have made along our business journey and still have today, they have been amazing and we could not have done it without them.
My favourite book that I whole heartedly recommend:
Dare to Dream Work to Win – Dr Tom Barrett
If you want to build your financial future or just save towards it Nicola can help! Click here or give her a call and go for a cuppa, you won’t regret it!
Nicola Taylor – 07940 853 890
This May 2020 The Business Clinic is inviting you to MIX IT UP...
Be a part of The BCO Team Building Day at The Anderton Centre – Think of it as ‘Beerworking’ goes outdoors!
The cost to attend this half day of outdoor activities and build connections and memories with your business contacts is £29.50 per head. This includes a morning of problem solving challenges with a fully qualified instructor and all equipment provided.
Tea and coffee is included but if you should wish to add any extras to your package please see the list below (this is to be added to the final price upon making your payment):
• Bacon Barms £2.50 per head • Danish Pastry £2.00 per head
Your immediate payment is the only way that we can confirm the booking with the venue.
After the morning session of action and entertainment, all who wish to join us can do so at a local pub for some lunch and optional beers.
We would love for you to join in the fun, our last team day out was a blast (as you can see on the right) and we know you’ll love it too!
...If you sell on value, not on price
By David Nelson
This article has been created from our January Advice Clinic “Have Your Cake and eat it!” and we have pulled out the best bits for you, the hardworking business owner, the sole trader the SME. The full time mum, part time freelance interpreter or the student entrepreneur from the comfort of their own bedroom. We all share the same passion and desire to pave our own destiny, and we all need a little extra help on that journey from time to time.
Some say that when you work for yourself you get the boss you truly deserve. For good, or bad.
How many employees can and do, blame the marketing department for not building enough awareness? The operations department for not delivering the service the customer should receive? The accounting department if people haven’t been paid on time?
As a business owner we have no one to blame, everything is either to our credit or our fault.
I always believe that we would manage our businesses much better if we could manage ourselves as we would an employee. If we gave ourselves the time we need to be objective regarding our priorities – we would certainly be a lot more efficient and fit in some of that much deserved work life balance we all strive to achieve.
So, do you feel that your business is being run by your customers? Your bank account? Your suppliers? Everyone but you? Well let’s try and address the balance.
Here, at The Business Clinic, we are aware that keeping our team hydrated will aid them to perform at their very best throughout the work day.
As a result, we decided to invest in watercoolers from AquAid.
Our unique relationship with AquAid has also given our company the opportunity to help those less fortunate than ourselves, because with each purchase an automatic donation is made to the Africa Trust.
These funds are used to build ‘Elephant Pumps’ - a modified version of an age old Chinese rope pulley system. One such pump is currently being installed in Africa on our behalf and it will be a much needed source of clean and fresh drinking water for many.
Our organisation’s name will be proudly displayed on our well and we look forward to adding a photo and letters of thanks from the villagers to our site in the near future.
To date AquAid have built over 8,000 such Elephant Pumps across parts of Liberia, Malawi, Mozambique and Zimbabwe; and have donated in excess of £15 million to charity.
If you have water cooler or boiling needs in your office why not find out more about installation and take part in saving lives with Aquaid's Africa Trust. Click here.
The Art of Focusing Group Energy on a Specific Goal
By Nathan Mayhew
Having focus and setting goals are certainly up there in the list of the most important things SME’s today can do to ensure the success of their business. These go hand in hand with why ‘Peerworking’ is such a successful method of business growth and development for many SME’s in Lancashire along with;
• Having a place to share knowledge, experience and ideas
• Being part of a powerful support network of likeminded people
• Challenging ways of working
• Giving yourself time to work on your business, not just in it
It’s no wonder so many people leave our sessions feeling motivated, inspired and ready to take on the world (of business).