If you’ve stumbled upon this post, chances are you read the caption on this Instagram post, and/or you’re a current or aspiring Entrepreneur, who wants some tips on how to realistically make a profitable income from your business/side-hustle.
Well, if that’s you, then you’re in for a treat, because this post is probably one of the most valuable posts I have ever shared when it comes to Business. It was only once I did the exercise that I’m sharing below, that I was truly ready to work for myself full-time, and make a living doing what I love.
So, if you’re serious about wanting to work for yourself or set the foundation for a successful business, then this post is for you. Operation secure the bag, let’s get it!
The Financial Exercise That
Helped Me Become My Own Boss
STEP 1: DECIDE ON YOUR TARGET INCOME
Before taking the leap and going into full-time business, I would highly recommend you figure out the exact amount of money your business would need to make, in order for you to make a full-time income and living out of it.
For example: Let’s say that amount is £50,000/year
Once you have an idea of what that figure is, go a step further and figure out what you would need to make on a monthly, weekly, and daily basis, in order to achieve your target amount.
Here’s what this would look like using the above example of £50,000
Target annual income = £50,000
Monthly = £4167
Weekly = £962
Daily = £137
STEP 2: LIST YOUR INCOME SOURCES
Regardless of whether you are a product or service based business, it is very important to have a clear understanding of the various ways in which your business can make money. Even if your business only sells one product, there are still ways in which you can generate an income based on your product, skillset, and some creative thinking!
Here are some examples:
Example 1 – Blogger/Influencer
- Brand sponsorships
- Speaking at an event
- Working as a brand ambassador
- Blog advertising space
- Selling a product e.g. Beauty Blogger creating and selling a makeup palette
- YouTube Ads
- Affiliate revenue etc
Example 2 – Hair Care Product Business
- Selling Product
- Hair Care Consultations
- Hair Care Ebook Sales
- Hair Care Workshops etc
STEP 3: PRODUCT VALUE & ALLOCATION
In this step it’s time to determine: the value of your products/services and the number of units you want to allocate to your various income sources. To keep this simple I will demonstrate how this can be done on a monthly basis, however you can also do this on a weekly and daily basis if you wish:
Annual Target Income = £50,000
Monthly Target Income = £4167
|Product/Service||No. of units||Value|
|Brand Sponsorship (Instagram)||4||£1800|
|Brand Sponsorship (YouTube)||2||£2000|
*The values used above are just an example but extremely true to life within the Social Media Industry
Determining the number of units you allocate to each product/service, and at what value you offer them, depends on several factors; some things that may help you determine this are: customer demand, historic success rate, time, resources, cost to produce etc
Click here to get the exact pricing calculator that I use to work out the number of products/services I need to sell, what I need to charge, & how many hours of work I need to put in to hit my monthly target?
So that’s it, that’s the exercise!
When I first did this exercise I remember feeling quite overwhelmed, I had quite a steep income target and based on my Influencer fee and earnings at the time, I’d have to put in an unbelievable amount of work to get close to my goal. Thank God I still had my full-time job!
Having said that however, it was the best thing I could have done for myself, because I now had a very clear idea of exactly what I would need to do in order to hit that monthly goal and therefore my yearly goal too.
I say this to encourage you to have a plan and keep on pushing. Remember to diversify your income and be clued up on your customers’ needs and pain points. When you’re able to understand what your customers need and you can provide them with a solution, you’re on your way to enjoying more financial freedom.
If you give this exercise a try do let me know, and be sure to share it with a fellow business minded friend. Let’s secure these bags together, there’s space for us all!
[Disclaimer: Examples used do not take into account factors such as taxes, pension contribution, national insurance etc however should be considered when putting together an advanced business plan]