Business Is Just A Math Problem
I hated math when I was in school and, to be honest, I still don’t like to have to deal with it whether it’s balancing my checkbook or preparing a budget.
However, I will unashamedly say I do like making money because that means I get to help more people! As you know, that’s actually the whole reason to be in business for yourself; to make money to buy you the freedom that you can do what you want when you want.
Business comes down to simply being a giant math equation. So, let’s look at the numbers involved in keeping your business on an even keel.
There are a couple of variables that you need. The first is how much money do you want to make? The second variable is how much is the average client worth?
The third variable, what is your close rate? This means how many clients do you have to talk to before closing a sale? If you’re just starting, it probably about 10% which means that for every 10 people you talk to, 1 person says, “Yes” to your services.
Then, what you want to do is know how many clients you need to talk to.
So, we just to need to work the math backwards. Let’s say you want to make $100,000 with the average value of the client being worth say $10,000 and your close rate is 10%, it means that you would need 10 clients at $10,000 to make a $100,000.
Therefore, you will have to talk to 100 people to get 10 clients if you close at 10%. See, that’s simple. Even I can do this math!
So, when you’re thinking about planning for this year, just work backwards. How much money do you want to make, how much is the average cost of the client worth and then figure out how many clients you need to talk to to make the sale.
Then, you can even divide that by 12 which, as in the previous example, that you would need to speak with 8 or 9 people a month to get your 1 client a month to make your $100,000 a year.
When you think of business as a simple math equation and realize you need only 10 clients to make over a $100,000 as the average value of the client at $10,000, it makes it really easy.
What are your goals for 2022?
If I can support you in achieving your goals, I would be happy to talk.
Simply go to callwithlorie.com.