April 2020 Profit Report – The Month We Surpassed Our Profit Goal by 15% and What We’re Focusing on Now
Episode 439: Show Notes
In this episode, we’re excited to do the profit report for April because we don’t know about y’all, but for us, April felt much better than March. When the pandemic first escalated in the US mid-March, everyone was freaking out and didn’t know what to expect. But when April swung by, people got more accustomed to the changes and things started coming into a rhythm again. Businesses were pivoting and finding ways to keep at least a portion of their income steady. We decided to lean into what was already working—to focus on what was performing well naturally. We could easily have tried new things but instead, we stayed focused on growing the shop rather than pushing our $2,000 signature program—which would have been a hard sell in the context of an uncertain economy.
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In contrast, the Creative Template Shop is a $47 commitment that helps people with their marketing, which they desperately need now to stay afloat. But for us to approach the crisis with the focus and energy that we are, we needed to make some good choices early on. We avoided mindlessly consuming media and thought carefully about how we were spending our time and who we were surrounding ourselves with. Negativity was the order of the day but we just decided we weren’t going to get sucked into it. This shift in headspace had a huge impact on our business because we spent less time worrying and poured more time into what was already working. In this episode, we once again tell it all—and we are thrilled with the results!
A One-Time Stellar Launch Versus Consistent Growth
We asked this question on Facebook: Would you rather have a skyrocketing launch or would you prefer to stick to consistent growth? Most of you said consistent growth, so it made us think long and hard about whether one was truly better than the other. Many people think consistent growth is this thing you can make happen naturally if you have all the right systems and offerings in place but we can guarantee you that it doesn’t work that way! The advantage of launching is that you put in a lot of energy at first but then you get to reap its rewards while opting for consistent growth demands that you are always pushing—an ever-going launch. But we reckon it depends on the season you’re in and what you’re feeling up to. On the other hand, it can be a bit of both. You experience the thrill of a big launch and come at it all guns blazing but then you can shift to the consistent growth mode every once in a while to take a break from the intensity. What has worked the best for us is the membership model because, among other things, it involves monthly recurring revenue (MRR).
Getting Into Sponsorship and Brand Partnerships
Our biggest area of income in April was from sponsorships. You don’t have to sell things to your customers necessarily in order to grow your business. Early on, we thought hard about how we could get the stuff we needed paid for by someone else and this is what led to us working with other businesses. We never argued that we were too small to reach out and collaborate with others—whether it is a software or anything else. We sought mutually beneficial relationships: from affiliate links in blog posts to full-blown collaborations, and it has become a big piece of our business. Last year’s sponsorship took up about 23% of our overall business and in April this year it made up 30% of our income. Keep in mind that it ebbs and flows, so you won’t always see sponsorships coming up in our profit reports. Here’s what happens when we have excellent brand partnerships: you get more help from more people. Your job gets easier every time you partner with a quality brand. For us, this means we can focus on creating amazing free content for our audience while they pay us to be part of our show and speak about their products and services.
Let’s Dive Into Our Other Income for April
Strategy Academy continues to be a large part of our business. Our monthly Strategy Academy coaching calls are some of our favorite things and they keep getting more refined: We get amazing questions and the same people keep coming back so we get to journey with them as their businesses grow. If you want to learn more and gain some free input, go to bossproject.com/watch for a free webinar. Historically, Trello for Business has made up anywhere from 5% to 30% of our monthly income, but this month it has come to only 9%—but this is only because we had such strong income from other sources! We didn’t make less money with it—it just seems less. This $29 product surprises us every time. So, when should someone think about creating a tiny offer like this? The answer to this question deserves an episode for itself but what we will say is, we don’t think a tiny offer should be your first offer. But when it is inserted into your business at the right time, it can be magic.
Let’s switch to talking about our baby product—the one that didn’t exist last year. The Creative Template Shop: between the memberships and our individual sales, it’s over 32% of our business. And the crazy thing is that we opened its door without having all the answers figured out because we wanted to respond to what our people genuinely needed. Our favorite items in the shop right now are those highly shareable social media graphics for your Instagram feed. You can see a demo on our Facebook group and IGTV, and the best part is that you can make these graphics on your phone!
A Summary of Our Expenses and Why You Need A Monthly Budget
Our cost of goods sold was 20% compared to 36% the month before, but really, the cost of goods sold stayed the same, we just made more money. We paid out about the same amount to our contractors too but this month it was 20% instead of 36% for the reason mentioned above. Abagail and Emylee’s salaries came out at 9%—they feel like they deserve a raise!
Now, to switch topics: we know that numbers are not everybody’s favorite but we’re going to tell you why you need a budget. When you have a budget, you have identified how much money you are spending in certain areas of your business so that you know how many sales you need to pay for all of those things, pay yourself, and make a profit. It is about working backward so that you know what to aim for. You can log into wherever your sales come in, look at your overall sales, and know at a glance whether you made enough money and hit your goals. If you don’t have that number, you don’t know what to aim for. Doing it can be this simple: find your bank or credit card statement, identify every expense you have on a monthly and annual basis, and fill it out on a spreadsheet. Here are some guidelines for your budget: You can look at paying other people about 20-30% while what you pay yourself will depend on the size of your business. If you are starting, you might pay yourself 50% of the total income but that number will reduce as you grow. Our budget accounts for us making a 30% profit, so if we hit our budget, we should make a 30% profit each month. This month we exceeded our income but our expenses stayed the same—we made an amazing 45% profit!
Quote This
April is showing the effects of us making some tiny intentional decisions in March that helped set the stage for April.
Highlights
A One-Time Stellar Launch Versus Consistent Growth? [0:10:51.1]
Getting Into Sponsorship and Brand Partnerships. [0:14:22.1]
Let’s Dive Into Our Other Income for April! [0:17:32.1]
A Summary of Our Expenses and Why You Need A Monthly Budget. [0:29:57.1]
ON TODAY’S SHOW
Abagail & Emylee
The Strategy Hour Podcast
We help overwhelmed and creative entrepreneurs break down their Oprah-sized dreams to create a functioning command center to tame the chaos of their business. Basically, we think you’re totally bomb diggity, we’re about to uplevel the shiz out of your business.
KEY TOPICS
Launching, Consistent growth, Sponsorships, Strategy Academy, Trello for Business, Creative Template Shop, Budgets, Numbers, Profit
