Keeping Your Business Smaller on Purpose without Sacrificing Profit
Episode 516: Show Notes
A couple of episodes ago, we teased at the end that we were already going into what could be a whole other conversation. This is that conversation. We are going to be sharing some tidbits we have learned and have deliberately decided to do or not to do in Boss Project, and within our side businesses, to seek growth and to keep our business and our companies in the range we want them to be. This is based on what we do and don’t want to do in that job. We know this sounds confusing but stick with us, and we will break it all down. We really want you to go and listen to episode 512 because at the end we start this conversation, so it might make a little more sense to listen to that one first.
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Why Bigger is Not Better
There is a common misconception among entrepreneurs that bigger is always better, that more revenue is sexier and more fun, but we are here to tell you this could not be further from the truth. This might seem counterintuitive because why wouldn’t you want your business to grow, right? We believed this for so long, till one day, we asked ourselves whether we wanted to be working at a breakneck pace forever. And the answer was, of course, no. So, we had to re-evaluate what this meant for our day-to-day, our teams, our revenue, and our goals. Yes, it’s great to have grand visions, but they come with tremendous sacrifices that, quite frankly, we were not willing to make. We could have kept going with our service-based business, where we were killing it. But when we changed to the one-to-many model, we could not reach the same heights. Scaling this model takes a lot of cash because of the software you need to make the systems work properly. When your business gets bigger, you have to weigh time versus money a lot more carefully, and if everything is automated, you may very well be cutting off your cash flow. The reality is that it gets more expensive to run a business as it grows, and this is a lesson we carried with us when we started our side hustles. We all have finite physical, emotional, and time resources, which is why we have been intentional about growing Boss Project and our personal businesses in a measured way.
The Downfalls of Scaling Your Business
Revenue and cost to run a business are not linearly correlated. The bigger your business, the more expensive it is to operate, whatever industry you work in. So, how do you choose when you pump the breaks on your growth? We went down from over 90% revenue with our service business to just over 30% with Boss Project, and guess what? We could not be more ecstatic. While we don’t like to compare ourselves, there are so many other small businesses that are just barely breaking even, and the large ones we always hear about are actually purposefully losing money! This is because they are so focused on scaling. So, we have broken down what we have done to help us grow intentionally to align with our ‘why.’ Yes, you might be sick of hearing us talk about finding your why, but once you know the reason for starting your own business, you will understand how much of yourself you need to put into it. What lifestyle do you want, what do you want to be doing, what do you not want to do? These are all questions that will guide your decisions on how to grow your company. So many business owners get out of touch with why they started their business. When you intentionally slow down, you actually get to focus on what you want to do. None of this means that we want you to make less money. It is possible, if you do it right, that you can make more profit by doing less. You have to get out of your own head and stop comparing yourself to others in your space because if that’s not the business you want, why are you wasting your time comparing?
Being Intentional About Slowing Down
The more customers there are, the more potential problems there are. Not enough people spend time thinking about this very important aspect of a business. There are pros and cons of running small and large businesses. It’s up to you to decide which path to pursue based on the role you want your business to play in your life. We are going to be straight with you: we don’t love people management. Don't get us wrong, we have the best team at Boss Project now, but it took us blood, sweat, and tears to get here. When we look at other businesses with teams well into the hundreds, warehouses, and multiple stores, we are happy for them but we do not want this for ourselves. These are great markers of what we don’t want to end up accidentally growing into because we love the flexibility of our lives right now. Emylee is deliberately not pursuing wholesale or doing markets and in-person events because none of these things are going to help her in the way she wants. Instead, she is choosing to have a high-touch packaging and shopping experience for her customers. That means she can charge more, but she doesn’t have to do as many restocks and can have fewer customers.
Making Choices that Align with Your Values
In the same way that more revenue is not correlated to expenses, a more complicated business does not make it more profitable. Just look at sales funnels. There are so many steps that customers have to go through to get to a point of converting. It's such a small percentage. All of these digital marketers are lying. We think it is still so much better to have direct sales calls. The only reason we even have a sales funnel as Boss Project is because we grew so big that we had to be able to talk to people at different stages of their journey. Abagail has been blogging for years; even Boss Project started as a blog. But when she surveyed people the other day, more than 60% of them didn’t even know the blog existed! So, can you imagine if we hid our main sales tool on a blog post, hoping that a client would find it and convert? It's not that complicated; just to go on Instagram and reach out directly. We know we sound like a broken record, but you have to establish these decisions early so you stay true to your mission. It's not easy because you will be tempted to go down so many rabbit holes. The best businesses are those that serve their owners, so if bigger doesn’t work for you, then it’s not better! There are so many people telling you to shoot for the stars, and this is perfectly fine. Do what is true for you. Make sure that the decisions you are making are in alignment with the life that you really want.
Quote This
There’s this misconception that a lot of entrepreneurs have that bigger is better.
Highlights
Why Bigger is Not Better. [0:03:06.1]
The Downfalls of Scaling Your Business. [0:09:24.1]
Being Intentional About Slowing Down. [0:22:40.1]
Making Choices that Align with Your Values. [0:30:34.1]
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
Slowing Down, Small Business, Profitability, Scaling, Intentionality, Values, Decision-Making, Alignment
