Tip – Increase Revenue Guaranteed
July 1, 2013
Ok, this is a cheesy title. Don’t you love it with people say things like, “Make more money, guaranteed?” Because we all know, it can’t be true. And, it isn’t true. There is no guarantee that you will make more money or increase your revenue. If you’re lazy and do nothing, nothing will happen. But, there is one little thing that you can do that will guarantee that you increase your revenue every year, year on year, provided that you put in the work. But, seriously it works.
Everything that is watched, improves.
This is a business truism. It’s actually a life lesson. It’s been proved in study after study. Everything that you pay attention to, improves. You don’t even have to try to improve it, it just improves. You know how they have those big signs in factories that reads “543 days accident free”? Simply by having that sign every day makes people be more careful and by having a goal it makes people work harder to beat that goal. They want to keep adding another day. It’s just human nature. Whatever you track and watch in your business improves. Whatever you pay attention to in your spouse, friends, kids, etc., improves.
What To Track
Track all of your income streams. If you look at the above fake sample, notice that Commercial is growing faster than Wedding income. This means that a business change needs to take place. Either this person should drop weddings and concentrate on commercial, or hire someone to shoot the weddings and free themselves to do more commercial work. While missing here, it’s probably not a bad idea to track online sales if you have an online shopping cart.
Additionally, track the change. Look at the red percentage numbers. That is the total change in revenue from the previous year. To do this, simply subtract the new year from the previous year. You have the difference in dollars. Then divide that dollar amount by the new year’s number. This will give you the percentage change.
The above example is for the years. In your spreadsheet, make a new tab for each year and break it down by month. This will give you information on what portion of your business brings in the most revenue depending on time of year.
How It Helps You Grow Every Year
Simply by tracking your revenue by month, year and revenue stream, your revenue will grow in all of these areas. Why does it grow? It shows what you did last year at this time and human nature is to want to improve on what you did last year. It also shows you where to concentrate your business throughout the year and going forward.
How Far Back Should You Go?
If time is short, just start at the beginning of this year. If you have some extra time, go back 2-3 years. Eventually, I recommend going back to the beginning of your business, as it gives you a huge sense of accomplishment to see the beginning compared to now.
What Software To Use?
I’m a fan of Google Docs Spreadsheet, especially because it’s free. It does everything you need. It’s accessible anywhere and if your computer crashes, you don’t lose your data.