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Do you Like Triple D’s

Hey everyone! Welcome to the first edition of Dave’s Daily Dose of Motivation. Sorry to disappoint you if you were looking or thinking something else. Dave’s Daily Dose of Motivation is going to provide entrepreneurs and small business owners daily motivation and tips to help them achieve more, be inspired, and take action in their business and life. I hope you enjoy them and please share with others who might need a little bit of motivation or inspiration to continue on with their goals and dreams!

Below is episode #1

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Knowing your Break Even will Help You Make A Profit

Yesterday, I wrote a post entitled ” Are You Making This Mistake in Your Small Business” and I revealed to you a shameful mistake that I made and pointed out that I believe many small business owners do as well. Today, I want to talk to you about the main reason we do business. First of all, let me ask you a question, “Why are you in Business?” Now, I assume your answer is to make money or a make a profit. With that being said let me ask you another question and that is do you know how many units or services you need to sell to Break Even and eventually make a profit? If we agree that we are in business to make a profit then it is equally or even more important to know when the business will become profitable.


Let me tell you finding this number out for me and with my business has been the best thing that could have happened to me. Like I said in yesterday’s post they teach you this the first day in business school but I, like most of us, just pushed ahead because we are ambitious to make things happen and start our business. This is a mistake though because not knowing when the business is going to be profitable leads to the business failing. Knowing when you become profitable allows you to plan how much cash you will need to have on hand to stay afloat until the business can generate positive cash flow.

Going through this with my business has been a life saver. I know now exactly when I will start making money and can plan sales and lead conversion goals around the number of sales I need to make to be profitable. Before I just started each day doing random things that needed to get done and did not have a planned approach on how many sales calls and lead conversions I would need to make my monthly, quarterly, and yearly goals.

So how do you calcualte your Break Even point?

First, you need to figure out all your Fixed Costs (FC). These include line items such as, rent, marketing, salaries, utilities, operating costs, etc… These items are consistent month in and month out.

Next, you need to figure out your variable costs (materials). Typically this will be the cost of selling each product or the cost to produce.

Then you need to take the price of your product or the average selling price of all your products if you sell more then one and make an assumption of how many sales you can make in a time period. For this exercise let’s say a year.
Now multiply the total number of units times the price of the product to get the total sales.

Below you will see the equation

Total sales(TS) -(VC)=Gross Income

Then take your gross income and divide that by Total sales to get your gross margins
GI/TS

To find your Break Even point you then do the following step:
(FC)/Gross Margin

Here is an example:
FC 5422
VC 200
Product Price 19.95

Units sold 100

Total Sales 1995

Gross Income 1795

Gross Margin 90%

Break Even Sales 6026.95

BE Transactions 302

In this example you can see that my fixed costs are $5422 and variable costs are $200 (you base the VC on # of units sold so for this example I used 100 units and each unit costs me $2 to sell)

Then do all the other calculations and you get to the following result.
I need to sell 302 units at the current price to get a total sales of $6026.95. Once I hit that level everything else is going to be profit.

So, can you see how helpful it is to know your Break Even point. Listen, if you ever want financing or investors that is one of the first things that they are going to ask for.

Go figure yours out now and if you need help you can contact me.

Stay tuned for the next post where we talk about your “Score Card!”

To Your Success,

Coach Dave

1

Are You Making This Mistake With Your Small Business?

Okay, I am a little ashamed to admit this but I made one of the biggest mistakes that most small business owners make. The thing that bugs me even more about making this mistake is that in business school this is taught almost day one and I still did it. Well, lucky for me I decided to start working with a business coach to help me through some of the struggles I am facing with my business. More on that later, but have I got your curiosity to see if you are making that mistake in your small business? Alright, I won’t keep you waiting any longer. The biggest mistake most small business owners make is that when it comes to figuring out their Break Even Analysis they forget to include into the fixed costs section a line item that has the owner’s salary!

Yes, you heard me correct. Most small business owners when starting out figure that as long as they calcualte and cover all the fixed costs, which typically include things like rent, operations, marketing, employee payroll, etc. that the business can survive and they are making it. Well, after going back and seeing that for the past year all my calculations have been based entirely on just having enough members of my Working Mom Workouts site to cover all the fixed costs minus a salary for me has made me realize that my entire marketing and advertising strategy needs to change. Once I added in a monthly salary for me the number of clients I ned to have paying me a monthly subscription has gone up 2-3x of what I originally projected. So, let me ask you again, “Are you making this mistake in your small business?” If so, don’t beat yourself up over it, in a follow up post to this one I am going to show you how easy it is to calculate your Break Even Analysis with your salary in it, so that you have a true picture of what it takes to have a successful business!

To your success,
Coach Dave

Need free website traffic fast? Try this!

Hi my fellow small business owners it is Dave, your small business coach here. Listen, one of the hardest things whether you are offline or online is getting traffic to your business. As many of you know I have an online business Working Mom Workouts.com, where I provide weekly fitness workouts to my clients. One of my earliest mistakes was I spent a ton of money on PPC and other online advertising to get traffic to my site. It worked but it nearly bankrupted me, so with that said I was left with really only one option and that was to get traffic to the site for “FREE”! I had some ideas but I went back to one of the guys who helped me build my membership site.

Now, there are some “go to” website traffic strategies that most successful internet marketers find themselves using over and over again when they need a boost in visitors to one of their sites.

One well known internet marketer tells of using some of them for more than a DECADE (yep, over 10 years!) and they continue to work with incredible results for him.

Others are “cutting edge” newcomers that are likewise driving people to his sites.

All of them come without a cost. Zilch. No budget. Free.

What’s even better is this:

They continue to pull in traffic for months and even years after he deploy thems.

It’s true, long after the initial “spike” in traffic comes in visitors continue to see his promos that are in place and they continue to click on them.

And he continues to make money from them.

You can too!

Jimmy D. Brown has prepared a free subscription to his new Traffic Jam Newsletter at:
http://imstitute.com/go.php?offer=texasdmcg&pid=20

In the first issue you’ll learn “10 Ways To Get Other People To Send You Free Traffic”.

There is no cost for the newsletter subscription. It’s available a few paragraphs into the page.

While you’re there, check out his amazing Traffic F.U.E.L. membership site.

It’s a 12-month training program that teaches you how to get completely free traffic to any website you choose.

Two things you need to know about it up front…

1) If you join now you can lock-in at the introductory price, which is a SUBSTANTIAL savings. Once these charter memberships are sold, the price will almost DOUBLE, so now is the time to get in.

2) There are two “fast action” bonuses that are VERY LIMITED. These will be removed without notice, so if you arrive at the site and one or both of the boxes with their description in it are gone, it means they are no longer available.

At a minimum you should drop by and grab a free subscription to his new Traffic Jam Newsletter.

And unless you don’t want any more traffic to your website, you should grab a charter membership to Traffic F.U.E.L. right away.

All the details are at:
http://imstitute.com/go.php?offer=texasdmcg&pid=20

Best regards,

Coach Dave

Do you want to build your own personal brand?

I am pasting this email on my blog to share with you an email that I received from a guy named David Frey. He is the owner of www.marketingbestpractices.com and the author of the Small Business Marketing  Bible. I have been following David for some time now and he offers these free Tele-seminars on different topics. I have listened to several of these in the past and they provide great information. If you are interested at all in building your own personal brand, sign up for the FREE seminar and listen to some of the experts tell you how to do it. Read the email below to learn more and then join me  for the calls.

Why Do THEY Seem To Get All The Business
And Not Me?
________________________________________

I get asked all the time by the small
business owners and entrepreneurs about
how they can get more business.

They look around and see others getting
all the business they can handle with
ease, while they struggle to get any
sales.

So, what’s the big difference? Why do
some people seem to get tons of
business, while others struggle to get
any?

In many cases, it comes down to how
they’ve POSITIONED themselves in the
market or industry… how they’ve
BRANDED themselves in the minds of their
market.

The GOOD NEWS is that you can do this
too! You can brand yourself and/or your
company and become the “Go-To” person in
your industry.

The GREAT NEWS is that you’ll learn how
to do just that in my new telesummit
series,

“The Branding Masters Telesummit!”

http://www.BrandingTelesummit.com

You can go and register for it right
now.

It won’t cost you anything.

And we interviewed some of the absolute
best branding experts in the industry.

Go see for yourself at…

http://www.BrandingTelesummit.com

Each day over the next week you’ll be
receiving announcements about the
different interviews that will be
playing that day.

The Branding Telesummit includes experts
in the areas of…

* How to brand yourself as celebrity in
your industry

* How to repair a tarnished brand

* How to get started building your brand

* How to create evangelists that promote
your brand for you

* How to re-brand your business if you
decide to go a new direction

And much more.

Go and sign up now.

http://www.BrandingTelesummit.com

Again, it won’t cost you a dime to
listen to these interviews.

Have an awesome day!

David