I’m just going to get right to the point here and tell you that the reason I have seen so many small business people fail is that the person that is working for themselves has no idea how to manage their money. Literally – NO IDEA.
Managing money as a self-employed person is a lot like trying to stay thin and healthy. It is all about planning, repetition, habits, and control. It isn’t necessarily fun, but you have to develop several new habits to be able to get what you want.
See, most of us when we think if being self employed envision having all this extra cash coming into our bank account to be able to spend on all the fun things we want. Small business = tons of money. While you definitely can make more money being self-employed there are responsibilities that come with working for yourself.
Reality check: You still have to budget but now you do it for your home and business (double budget) and you also budget for the fun things you want as well. Then write a check to yourself that may or may not be the same amount every time.
Owning a business does not automatically mean you will have all this extra cash in your bank account. However, owning a successful business mean you can create a higher earning potential than being employed. That is the feature that draws people into working for themselves. Its just that no one tells you the details about how you will actually need track and manage all of that to be successful.
It’s the expectation of money vs the reality of money when you are self-employed that makes people struggle when they work for themselves.
I have known therapists who have worked really hard only to give up full practices to find a job and work for someone else. Why? Because they couldn’t wrap their brain around how to manage their money and they wanted something simple (even if it paid less overall). They wanted a paycheck every 2 weeks and no responsibilities to a business. Burn out? Maybe. But I think it was unmet expectations.
If your business doesn’t meet your expectations, then even with success you struggle to have your business make your life “feel” the way its is supposed to be.
The solution is to bring your expectations more in line with the reality of how a small business works. You must first change your belief structure to a more realistic belief and then start to incorporate the habits that help you be successful.
Paperwork and Budgets
These tasks are an essential part of running a business that are typically the last thing on your list to do. To create more success in your business you must stay on top of income and payments and know where you are “at” all the time in your company. This should be a priority in your schedule. Set aside the time to budget, plan, and make financial decisions that set you up for success down the road. Remember, as the “boss” you have to plan for your company to succeed.
This is a “boss” responsibility again. Your company won’t get where it needs to be if you don’t know where its headed. Many times, the goals you set are financially driven so how you budget can easily generate your goals for you.
Example: You have $1000 that you need weekly to meet your goals; business and personal. In our profession, that number translates into a certain number of massages.
Let’s say you charge $75 per session. You need to have a consistent weekly schedule of 12-13 booked appointments to ensure that money comes in. Your goals should be something like this: have 3 days of 4 clients and 1 day of 2 clients (just in case you get a cancellation).
You then have to create the marketing plan to ensure that you fill those appointments.
Check in with Yourself Often
You need to assess yourself and your business regularly. As the “boss” and employee, you have to sit down and figure out where you are at. At least quarterly!
Are you meeting your goals? (Massages per week)
If not, what is the plan to increase that?
Are you budgeting and managing your money proficiently?
Are you keeping motivation?
If not, how are you going to re-motivate yourself (check out education blog here)?
These new habits are some of the keys to success that you may not have understood completely when you decided to start working for yourself. The great thing is that you can start today and see for yourself how your attitude about your business while begin to change into something much more positive.
If you would like more information on motivation, check out the video library of topics specifically for the self-employed massage therapists at massagebusinessmethods.thinkific.com