Being a business owner can be…conflicting.

Let me explain.

I wear at least three hats relative to my business:

  1. Management 
  2. Owner/investor
  3. Family member

You wear these hats, too. 

Like me, your job is to manage your business. You’re probably doing the work of 2 or 3 people. And you’re the most reliable employee - responsible, accountable, detail oriented, and deadline driven.

You wish you had ten of you! 

You’re also responsible for making sure that you and other employees are doing their part to ensure that you’re getting a return on your investment. That the everyday decisions being made and work being done increases the value of your business over time in a way that you can ‘take to the bank’ at some point. 

Of course, you’re building your business to provide for your family. You have obligations and responsibilities to fulfill for them. Sometimes doing what’s best for your family is also what’s best for your business. 

Sometimes not.

And even if you’re not in business with family members, they might have a lot to say about decisions you’re making as owner/investor and manager. 

In short, your different roles are sometimes in conflict, needing contradictory things at the same time, competing for finite resources, or requiring you to disappoint someone you love because it’s what’s best for your business in the long run. 

Here’s where you embrace the suck.

Honestly, there’s no way out of it. 

You had role conflict as an employee. Now you have role conflict as the employer. 

Choosing to work for yourself means you’ve traded off some restrictions and limitations for others. 

But you also have the ability to identify where conflict exists, purposefully align goals, intentionally manage resources, and consciously deal with the demands of, well, being you.

Start by recognizing that your family and your business are interconnected and separate from you while profoundly impacting your identity and sense of self.

Then accept responsibility for managing the coordination and tradeoffs your different roles require.

Conquering Conflict

There are five steps to creating and aligning your family and business plans. 

1. Identify your assets: what valuable and useful things do you already have that you want to protect, improve and/or grow? What’s most important to you?

2. Protect what you have: what, if anything, is needed to protect the assets you have?

3. Build with intention: what long-term opportunities exist? What investments do you want to make to grow or enhance your life?

4. Reap and steward your rewards: oftentimes, to reap the rewards of building a loving, happy family you will want to spend more time with them and doing the things you love. Early on, your family probably took the hit when you had to choose between a baseball game and a networking event. In order to reduce your family’s sacrifice and increase the rewards of owning your own business, it needs to provide you with income and generate profit when you’re not there. How much the business needs to provide depends on what you need and how you want to spend your time and money.

5. Reflect: what has this process revealed? Has it changed how you will approach business planning for 2024 and beyond? 

 

There are a lot of reasons my siblings and I didn’t go into the family floral business but the biggest one is that my dad worked for himself. He build a job not a transferable asset.

In the beginning, it was a means to an end that allowed him to take care of his family and work for himself.

In the middle, it was easier to keep on keeping on than it was to strategically respond to a changing market, create a plan, document and professionalize processes, and design the business to operate without him.

In the end, there was no business exit plan. It was too late and there was nothing of real value to pass on or to sell. 

An asset can be grown, shared, gifted, sold, collateralized, liquidated, repurposed, or monetized.

A job can’t. 

If you focus on maximizing income without also building value in your business, you limit your options and diminish how much wealth you can generate by being a business owner. (Hint: value is more than revenue and there are many ways to build value and exit a business.) 

My dad’s choices feel particularly relevant as clients of all ages are asking me

The truth is, most owners assume they have lots of time and only a few options for when and how to exit their business.

There are actually lots of options - including more than one exit opportunity for the same business.

And, in it’s current state, your business probably isn’t attractive to a buyer.

Given that 70% of businesses that go to market don’t sell, there’s no time like the present to start assessing your business readiness and attractiveness so that you have plenty of time to increase the value of your business before it’s time to exit. 

The good news is that many businesses can improve their attractiveness to buyers and readiness for the process by making choices now about how to grow strategically. You can start by

This approach not only builds value in the long-term, it also increases income right now.

Which means a solid growth strategy = near-term gain = a solid exit plan for the future.

Exit planning isn’t a separate process from your annual visioning and planning. It’s an intentional approach to business growth that prioritizes asset building over income acceleration, without having to sacrifice either. 

So, if my Dad had treated his business as an asset and not just an income stream, what would that look like? 

1.Create value. Make sure the business has all the resources it needs to grow - staff, customers, processes, and relationships. Taking yourself out of the equation as much as possible is essential. If the business relies on you for sales, product development, and/or key relationships it has little value for someone else. 

For example, by building a list of well defined, qualified leads, you add to your business’ value. Likewise, by having guaranteed recurring revenue, replicable processes and procedures, and a well known and reputable brand, you make your business more valuable. Value is also derived from solid cash flow management, consistent profitability, and investments in the business infrastructure. You have to assess where your business is in all areas to know where you need to invest time building value. 

Most of your business value will come from intangible assets, your intellectual capital - people, relationships, processes, and reputation.

Seriously! 

You need a strong P&L, balance sheet and cash flow. But that’s not enough.

2. Grow. Since your business needs to operate without you, you probably need to increase revenue and cash flow so you can hire a management team capable of successfully running the business. Growing your business may also require additional capital. You may need to invest time and money to position yourself to get top dollar when you transition. 

Once in place, the management team needs to strategically grow the business for sustained success. Buyers want to know that your business has the potential to create more profit and wealth for them. And you deserve to get the most out of your business while it provides you income and when you harvest its value. Preparing to exit is good business strategy. 

3. Plan your next act. This is especially important if you need a specific amount of money from the sale of your business to finance your retirement or next venture. Do the proceeds from the sale need to be invested to replace your income? Or will that money seed a new venture? Will it help you travel or fund your grandchildren’s education?

In addition to knowing how much you need to live the life you want, you also need to know what you want to do with your time when you no longer have a business to run.  According to the Exit Planning Institute, 76% of business owners who sold their businesses profoundly regretted selling within a year. Don’t underestimate the feelings you will have about selling. This is a big deal. A major life transition that needs to be planned for. You’re way more attached to your business than you think you are. 

You are not your business. You built your business but it exists separate and apart from you. It’s worth is not your worth. It’s one part of what you do but not who you are. 

4. Engage advisors. There are no less than seven ways to exit a business in an orderly manner. And there are hundreds of ways to do it that can destroy more than a once reliable income stream. 

Yes, good planning takes time.

Yes, good planning takes money. 

This is true whether you're planning to exit or just trying to get the most out of your business right now. Great execution requires more than a good plan. It requires several teams, a few outstanding individual performers, and a leader who can put the right people and resources into play at the right time to achieve success. 

As owner, you’re the visionary and quarterback. Your job is to lead your team to deliver consistent wins, relentlessly, over and over again, despite the circumstances, through both your personal performance and your singular ability to strategize and lead others. 

Your management team is the team on the field responsible for execution on the front lines, in real time. 

Your advisory team is equivalent to the team behind every legendary quarterback who has walked onto the field. This team helps them train, condition, strategize, and focus mentally, emotionally and physically to visualize and manifest success. Yours will do the same and help you push through the pain, prepare for the unexpected, develop new plans in response to specific competitors, reduce your distractions, engrain the fundamentals, and recover from setbacks. 

You’re the starting quarterback. The leader of your advisor team is your backup quarterback. This is usually a business consultant, value or growth advisory, someone who understands your vision and can mobilize and organize other advisors to help you deliver effective decision-making and consistent accuracy in executing toward your goal. 

Feels pretty intense, huh.

Don’t get me wrong, it is. 

But the thing is, you work hard in and on your business everyday. Building an asset vs. an income stream doesn’t require you to work harder, only smarter.

Vision, intention, planning, resource deployment, and execution take your work from intense to purposeful.

Working with an advisor - one to start, others as needed - gives you the depth of bench you need to get and stay focused.

Shall we get started planning your business exit?

Frankly, we don’t talk enough about pricing, profitability or paying yourself as small business owners. 

So let’s talk. 

Paying Yourself

This is why you started your business - to make money doing something you love. But did you ever ask yourself

Building a business that isn’t or can’t achieve your financial goals is a waste of time, IMHO. If you don’t need the money and the business isn’t profitable then it's a hobby, and that’s ok.

I love hobbies but I don’t expect my crocheted blankets to pay the bills and while I love coaching and consulting with business owners I won’t keep doing it if it means I struggle to make ends meet.

I assume all business owners want their business to help them create a life they love, one that has some degree of financial comfort, perhaps even freedom. 

So let’s get real about what you want to make and how frequently you need to be paid. 

Then figure out how much the BUSINESS has to make for you to hit your financial goals and take care of your obligations (taxes.) You can use this template to get started. 

Profit

You can’t pay yourself competitively and consistently if your business isn’t generating a profit. 

Just because there’s money coming into the business doesn’t mean it’s profitable. 

Profit is what’s left over AFTER you pay all the bills (COGs and operating expenses), pay yourself, set aside money for taxes, and service debt. 

Profit allows you to create a reserve so you can fund your operations for at least 3 months. 

It gives you flexibility to make new hires, buy new equipment, upgrade technology, or make other investments to grow your business. 

It gives you breathing room so you don’t have to panic each time payroll is due. 

In many businesses, it’s reasonable to expect that you won’t be profitable right away. You may have to put more money into the business than you take out. That’s why it’s so important to do projections (the silent P in this list!) Projections are a way to forecast the future. IF we do A, B and C we can expect the result to be X, Y and Z. 

Like profit, projections don’t magically become true. They’re your best guess about how to run your business so it can meet all its financial goals. Never run projections or want some help getting better, click here to schedule an appointment. 

Pricing 

Pricing truly is both an art and a science. 

Some industries are price sensitive with most sellers priced in a narrow range because buyers won’t tolerate big deviations. 

Whenever possible, you’re not looking for the customer who wants the lowest price. Your customer wants the best outcome - whether that’s to look and feel beautiful, save time, or increase performance. They want specific results they’re willing to pay for. 

Pricing requires you to understand what it costs you to produce and deliver your goods and/or services, what indirect expenses you need to cover, and your desired profit margin. 

The single biggest pricing mistake I see owners make is to leave the cost of their labor out of the pricing equation. 

In most small businesses, the owner is doing a key business function. You’re probably the person making the body butter, providing the counseling, doing the renovations, designing the greeting card - you get the idea. If you were paying someone else to provide that labor you would consider them a direct cost. So why wouldn’t you do the same for your labor?! 

You can never replace yourself in the business if you aren’t factoring the cost of your labor into your price AND paying yourself market rate for doing that job. 

Just ‘paying yourself out of profits’ isn’t a thing for small business owners. You can’t live off a quarterly dividend. You need the equivalent of a regular salary. And one of the benefits of ownership is that you can take additional distributions when profit margins allow. 

So your price has to take into account what it will cost to pay you, cover other direct expenses, and contribute to indirect expenses, profit and taxes. 

Once you create your pricing template you’ll use it when considering pricing changes, creating new products, launching new services, or creating new packages. Not sure where to start? I’ve got a template for that too!

Recently, I got a panicked email from a client saying business was way down the prior month and lamenting that they never should have raised prices. 

Of course, there is always cause for concern when sales are down from historic trends. And increased pricing may have impacted sales with some (price sensitive clients) opting to go with other sellers. 

It may also be true that 

And in this instance a price increase was necessary because the old pricing model was not profitable. So having more sales with little to no profit margin wouldn’t be much better than having fewer, more profitable sales. 

I share this to say, in your business there are lots of variables impacting revenue, expenses, cash flow, and profitability. Often, the most obvious explanation for what’s going on is part of the answer but not the whole answer. 

This client is also rebranding, updating their website and focusing on a higher-end niche client. Those shifts can impact revenue and profit in the near term. They will need to make changes to their sales and marketing, which may cost more, impacting expenses in the near term and revenue generation long term. And they are adding a new line of business that can help them tap a new market. 

Lots of moving parts. 

Which is what I tried to remind them of when I replied. But it can be hard to step back and take a second look when things feel like they’re going the wrong way. 

That’s why it's important to have ways to catch changes before they show up on your income statement and freak you out! 

You might (regularly) look at the

The key is knowing what indicators matter most for YOUR business. What’s gonna give you the best idea of what’s going on or at least alert you to where you need to be looking. 

Think about what information will help you know if your revenue, expenses and profit goals are within reach or if you need to make some real-time changes. 

Be intensely curious about what’s going on in your business and industry.

Bring your awareness to things you don’t like doing in your business and whether those areas might need more attention to drive results.

In a recent interview with Cheryl Mucha of CFO Your Way I was asked, ‘why do people come to you? What’s their pain point?’

Most often, business owners find me when

They know they need to do something but want to avoid the proverbial face plant.

Fear of the face plant can keep you stuck, hesitant to make any move even though you know you can’t stay put.

Or it can drive you to take action - any action - to avoid the anxiety of feeling like you’re falling behind and missing opportunities.

Neither gets you where you want to go. More importantly, these approaches don’t help you have more clarity and confidence as an owner and a leader.

I specialize in helping business owners like you find that clarity and cultivate the confidence you need to define, plan and achieve your desired end result for your business.

That looks different for everyone but usually includes a combination of

Sure, we work on, create and discuss financial statements and financial projections, org charts and procedure manuals, and delegation and prioritization.

We also spend a lot of time talking through issues, thinking through scenarios and honing your ability to lead effectively - from personal habits, time management and planning techniques to providing your team with the tools and frameworks they need to work smart on your behalf.

And there is the accountability piece. Since consistently doing the basics - the everyday things that you need to do to meet deadlines, deliver on brand promises, build strong relationships, and work efficiently - is the single most effective way to out perform your competition and meet your goals, the other thing I do is provide the encouragement you need to stay focused and consistent.

As my friend Jess Dewell and I talk about often, it’s all about defining the destination, charting your course and staying the course.

Do those three things and sustainable, profitable business growth is yours to achieve.

Need a little inspiration to jump start your aspirations?

Listen to my whole conversation with Cheryl Mucha. Then reach out so we can talk about how to get you headed in the right direction.

It’s easy to start doing things that feel productive but don’t help you achieve your growth goals.

If you’re feeling pulled in a lot of different directions or you just can’t seem to hit your revenue or profit goals, you probably need to evaluate whether you’ve selected the right growth levers and sufficiently invested enough time and money to get the results you want.

In other words, growing your business requires you to know

There are lots of ways to increase revenue. By evaluating and choosing the method that is best for your company you can focus your time, energy, and money on specific tasks. Be effective, not just busy.

This allows you to stay the course as uncertainty and ambiguity tempt you to throw the kitchen sink at achieving your goal.

And, because you’ve evaluated the different strategies available to you, you can assess the effectiveness of the strategy you’ve selected and pivot as new information is available.

The ability to be resilient and reorient activities to stay aligned to achieving your desired end result is critically important. 

But first you need to figure out what business lever(s) you’ll use. You then pick a strategy for deploying that lever. 

Please note: I hesitate to put the ‘s’ in parentheses - for almost every small business it's in your best interest to focus on deploying one lever at a time, with full commitment and focus. 

Business Levers for Growth

So what’s a business lever?

It’s an organized approach to solving a business problem (or maximizing a business opportunity) that allows you to drive growth. 

What lever(s) you use depends on your market, industry and business model. 

No one can write an article that will help you sort through all possible levers and tell you which one to use to grow your business. However, they commonly involve deploying some combination of money, people, processes, time, products/services, or technology to grow. The lever you choose should be based on 1) available data (internal and external) and 2) analysis of your capacity and capability to execute. 

Sources of data: 

Capacity and Capability:

Examples of Levers:

You’re looking for levers that can create the growth in ways that are sustainable. Top line growth alone won’t necessarily grow the bottom line long term. 

Pro tip: Focus on levers that increase profit not just revenue. 

Still feels a little overwhelming, right?

In my experience, it's always helpful to get an outside perspective. Someone with fewer emotional ties to certain strategies and less bias about specific choices. 

Working with a trusted advisor, someone solely focused on helping you achieve success as you’ve defined it, can bring clarity and peace of mind to business decisions. 

That’s not a luxury. 

You deserve to feel calm and confident as a business owner.

Let’s talk.

‘Christy, I don’t know that I want to sell my business. Maybe that’s not in the cards for me.’

I hear you. AND if you run your business today like you want to sell it tomorrow, it will make you more money no matter what you decide to do. 

And here’s the thing.

Sell. Don’t sell. That’s up to you. 

When you build a business that is sellable, by definition it's profitable. 

All those things sound like positive outcomes to me. Things I want for my business and for me regardless of whether I want to sell it at some point. 

Essentially, buy building your business like you plan to sell it you’re building your business with intention. Making thoughtful decisions, investing in operations, getting good at routine administrative functions, and delivering on your promise to customers. 

Rather than worrying about whether you might want to sell or thinking it’s too early to worry about it, what if you looked at strategic business growth as a long-term investment that will increase your income today and the value of your business - to you, your employees and customers, and potential future buyers?

What do you have to lose!?

Interested? Let’s talk.

I talk a lot about the importance of clarity - clarity of purpose, role and process. 

Sometimes people confuse clarity with certainty. They’re not the same. 

I can be clear about what I’m supposed to do, how I’m supposed to do it, when it needs to be done and why it’s important. AND lack certainty about how the work will unfold, what the outcome will be or whether I will need to reevaluate and change course. 

Since uncertainty is the norm, it doesn’t do you a lot of good to struggle against it. 

Or to fantasize about a day when all will be ‘under control.’

Instead, a better use of energy is to recognize the risks uncertainty can create in your business and make decisions to mitigate its impact.

This might look like asking and answering these questions:

  1. What’s most important to me?
  2. How do I define success?
  3. Who needs to understand this?
  4. What business levers can I use to get my desired end result? 

What’s most important to me?

You started your business for a reason (or two.) What are they? Is your business helping you create what you most want? If not, why?

Getting clear on what you care about most makes it easier to answer the next question. And it helps you stay on track despite interruptions, disruptions or when there simply isn’t much information to go on. 

How do I define success?

In a world where overwork is the norm and success is often defined as ‘more,’ it’s important to be clear about how you define success. 

Achieving someone else’s definition of success can leave you feeling empty and unfulfilled. 

Defining and sticking to your own definition of success may feel risky, if it doesn’t fit the norm. But being able to pick your own metrics (financial goals, giving your kids experiences you never had, having a flexible schedule, avoiding burnout, etc.) makes it easier to stay the course when you feel pulled to fulfill the expectations of others. Or when uncertainty tempts you to follow someone else's playbook. 

Who needs to understand this?

Who in your family, professional network and business needs to understand what is most important to you and how you define success?

Anyone who is directly or indirectly helping you grow your business needs to know this information. Only with this clarity can they make choices and take action in ways that align with what you care about most and keep you on track to succeed on your own terms. 

When all else is uncertain, the clarity this information provides helps people cope with ambiguity and stay focused. It reduces the risk that you (or anyone else) will start doing things that relieve feelings of uncertainty in the short term and derail your long term success. This is one way clarity helps us get cool with uncertainty. 

What business levers can I use to get my desired end results?

In the midst of uncertainty, it’s easy to start doing things that feel productive but don’t help you achieve the success you desire. 

It can also be tempting to try to do a whole bunch of things at once, which dilutes the impact any one strategy can have.

And we can run smack dab into inertia if the options seem overwhelming. 

By identifying which business levers to focus on you work smarter, not harder and deliver faster results. 

Your lever might be money or people. It could be time or technology. Perhaps its processes or skills. 

There is no ‘right’ lever, just the resource that, when focused on a specific goal, is able to help you achieve success as you have defined it. 

Now every lever needs a good strategy…more to come on that soon!

Bottom line:

Despite the uncertainty you experience in business every day, your job is to lead the growth of your company. Hopefully, these questions will help you define and achieve success regardless of the ambiguity you face. 

Of course, it can be easier to ask and answer these questions with the help of a business coach. Purpose First Advisors is ready to help you (re)start the process. 

Wanna grow your business?

Start with making time to ask yourself good questions about what growth means for you and how you want to achieve your desired results.

On a recent episode of the Bold Business Podcast, I talked with my fellow panelists about how much time it takes to ask strategic questions that drive your business forward.

Before we get to how much time this takes, we agreed that first you have to make the asking of those questions a priority so that like other important things it gets on your calendar and your to do list.

Then you have to treat the time you schedule with yourself to ask questions of and about your business as important as any other appointment you have.

In other words, make a standing appointment with yourself and keep it.

That’s where you start.

Not every question you ask will be a strategic question but with time and practice you’ll get better at asking good questions that lead to other good questions.

You can get better faster by

  1. Giving yourself grace: Making appointments with yourself to focus on what you and your business need can be a challenge. Sometime you won’t do it as consistently or frequently as you would like. Understand where you’re at and be flexible. Some planning time is better than none. Be flexible.
  2. Stop worrying about getting it ‘right’: There is no ‘right’ way to ask strategic questions or some magic set of questions you should be asking at any given time. In my experience, you can’t hack growth so just start thinking, reflecting and asking.
  3. Experimenting: Have an idea but you’re not sure if you’re on the right track? Find was to test it - fast and cheap. What did you learn? What new questions do you have?
  4. Engage others: Even solopreneurs have people they talk about business ideas with. Pull in your formal and informal advisors, employees, key vendors and anyone else who can help you ask better questions or source the answers to the questions you’re already asking.

It also helps to

To hear more musing on the topic of asking strategic questions, check out our entire #BoldBusinessPodcast episode on apple podcasts or watch the YouTube video below.

//www.youtube.com/embed/E6W9Gc8fctk?wmode=opaque

 

One great way to commit to making time to ask strategic questions to grow your business is to work with a coach. Ready? Let’s talk.

I wrote my first ‘reminders’ blog for small business owners back at the beginning of pandemic in 2020. Since then, a lot has changed and stayed the same. 

Running a business continues to be hard and it's easy to get caught up in the weeds. 

So whether you’re dealing with a pandemic, inflation, a recession, generalized anxiety about the economy, or an average Tuesday, it can’t hurt to have some gentle reminders that help you recenter and reorient to take your next aligned action. 

1. Plan for the future 

Planning is hope in action. 

To plan is to believe in a future that doesn’t yet exist and your capacity to thrive regardless of the circumstances. 

Planning gives you a running start to take advantage of new opportunities and respond thoughtfully to unforeseen challenges. 

2. Improve your relationship with time

Time is a construct. So you get to build the relationship with time that best serves you. 

My friend Jess Dewell helps her clients make more time. No, she doesn’t have a time machine. Instead she works to create a schedule that maximizes her time to plan, ensure that she’s focused on the right things, delegating what needs to be done by others, and setting a pace that allows her to take care of business and herself. 

You can get started making more time by

3. Stay connected

People do business with people. You need to be in deep, authentic relationships with our customers, employees, and vendors. Lean into your relationships and continue to be of service, create value, and create connection. 

Interested in working with someone to put these reminders into action? Let’s talk.

maroon quotation marks
  • I have said many times to colleagues, “I wish I had hired Christy Maxfield a few years ago.” Even with a 27-year-old company, I have learned so much from her. Christy has been an invaluable partner helping me operate my company more strategically, i.e. strengthening financial reporting, guiding succession planning, navigating complex people decisions, and increasing the overall value of my business. Christy brings insight, clarity, and genuine care to her work. Her disciplined approach and guidance has made me a more confident and effective business owner and positioned my company for its next phase of long-term success.
    Laurna Godwin
    Owner, Vector Communications
  • What sets Purpose First Advisors apart is that her coaching evolves with you. The support I needed at the beginning of our work is very different from what I need now, and she has adapted alongside me every step of the way. Her approach is strategic without being rigid, and she has helped me build confidence, sharpen my business strategy, and create meaningful momentum in my work.
    Paya Sample
    Owner, Peak Leaders Collective
  • Christy took the time to assess my business model, understand my goals, and identify areas for improvement. What impressed me most was her ability to provide tailored strategies that were practical and immediately implementable.
    Sue Bailey
    Owner, Celebrating Life Cakes
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