If you don’t know this one thing – your minimum turnover rate – then you could be destined for failure in your business. It’s that important! And that’s what I want to talk about here.
Good morning! Welcome to another episode of The Drive. Dean here, on the way to Internet Profits HQ. And it’s a little brighter this morning, although it’s that time of year where it’s freezing cold.
I’m actually running a bit late. I was doing a webinar with all those who’ve joined our Certified Partner Program last night, and it went on a little later than planned.
So when I jumped up out of bed this morning, I’m actually running behind. I’ve missed the gym this morning, I’m sad to say. But I’ll make up for it tomorrow. It is what it is.
I was talking to somebody – an offline brick-and-mortar business owner… When was it? A few days ago? Weekend maybe? I can’t think now, but just recently.
And we got onto the topic of…
Understanding And Knowing Your Outgoings
Understanding basically how much a business has to make in order to keep the doors open. Meaning ultimately, like the minimum requirement of profits or turnover rate in order to stay open, in order to stay in operation, y’know.
All too often (and this was this was my version on this). I was talking about, y’know, that it’s common practice in an offline business – a restaurant, or a store, a brick-and-mortar store in the high street – they need to know what their outgoings are.
They need to know that turnover rate figure, in order to understand how much they have to be bringing in, in order to keep those doors open, right? In order to keep paying the bills, to stay open – as a…
Minimum Viable Turnover Rate To Stay In Operation
…let alone then going into profit. (Difference between profit and turnover)
And a lot of business owners… He was basically saying, it’s surprising what he sees – a lot of offline business owners don’t know that turnover rate figure. They just kind of keep going about their business every day, and they don’t know that figure.
This is why a lot of people go out of business. Because they don’t know that minimum target, that minimum income they have to generate to stay open.
Then obviously, we got onto the subject of my industry – online business, digital business. And I said, “Well it’s probably even worse in this industry.” Because a lot of people when they start out, they just pluck out this figure and it tends to be,
“I Need To Make $10,000 A Month”
Now for some people I’m sure that’s true. But for the majority, most people don’t need to make $10,000 a month. It just seems to be that figure, that’s been clung on to and thought about.
And that’s the figure that everyone goes for… which is a fine figure by the way. I’m not saying that it’s not something to strive for and aim for.
But what I’m saying is, in terms of keeping the doors open on the business… Or let’s just say, for example…
If You’re Stuck In A Full-Time Day Job
…and your desire is to become your own boss. To be able to run your own online business from an independent location wherever you want. Whether that’s at home in your lounge, or a home office, or like me – we have actual offices. Really… you shouldn’t just pluck that $10K figure out.
It’s nice to have a target figure. And I always encourage people to go large with their goals, because it’s that whole thing – if you shoot for the moon but only land among the stars, then you still did well, right?
The thing is… it’s good to have a target. But you should also understand what that minimum turnover rate number is, to allow you to achieve your goal.
So if you have this deep down desire to…
Quit Your Day Job And Just Work From Home
…and then be in a position to grow it full-time. Then your minimum figure should be calculated based around…
“What is the minimum amount of money that I need to earn to pay my bills, keep a roof over my head for me and my family, to put food on the table, and quit my day job?”
And know THAT figure first!
I like people to…
Do These Two Things:
ONE: Think of a big target that you’d love to strive for, that if you hit that target you could live your absolute dream life.
That might be ten to twenty thousand dollars a month, I’d imagine, for the average person. There isn’t a lot you can’t do with twenty thousand dollars a month I assure you.
So have that big figure – so you’re like, “That’s my dream lifestyle!” And what does that look like?
TWO: But then also have another figure, “What is what is the minimum amount I need to make, to accomplish that certain level?”
Whether it’s to quit your job, to supplement your pension, to just have a bit of extra disposable money. Whatever that minimum target is… know THAT figure as well, okay?
Because when you know that one… you then set yourself…
A Sequence Of Steps To Get To Your Dream Life
And the first goal can be to get to that minimum turnover rate, so that you can get out of your job, or take that pressure off, or supplement that pension, y’know, whatever it is.
Everybody’s in different situations. And so that’s what my message is today.
Do You Know That Figure?
And if you’re in business, if you’re running a successful online business, you’re doing this full-time already… do you know what your minimum turnover rate is to continue to operate?
Y’know, a lot of online businesses and offline businesses… they go through peaks and troughs, as I would call it. They’re on this roller coaster income. Very little businesses as they’re always constantly growing, they tend to be a bit more like this.
And so you’ve got to know that minimum turnover rate figure, so that you don’t end up in trouble, okay?
So with that said, I’m at the headquarters now. It’s time to jump in and get on with the day. I will of course see you again in “Do Facebook Ads Work? Be Extra Careful Who You Listen To…” – another episode of The Drive.