How to plan your revenue goals and the strategy to reach them
Have you taken the time to sit down and actually seriously plan your business, your revenue goals and a strategy to reach them?
If you haven’t, you’re not alone. Planning revenue goals and developing the right strategy to realize them should be any solopreneur’s top priority, but all too commonly it’s left to fall by the wayside.
I don’t want this to happen to you – and I know you don’t either!
I’ve put together 4 steps to help you plan your revenue goals and the strategy to reach them AND in a way that’s aligned to your values and lifestyle.
This blog article is a summary of the related podcast episode.
Click here to listen to the tips mentioned in this article.
So many don’t take the time to plan revenue or inspect their finances. You know what it’s like right? Life gets busy, plans drop away and then you become resigned to not reaching your financial goals and give up planning altogether.
I can’t stress the importance of pausing during the year to take the time to plan how you will make money and how you will make profit. You might be someone who already does this, but have found it’s not very effective. It’s certainly not easy, which is why I’m sharing 4 steps with you to help you plan your financial goals and more importantly, to reach them!
Imagine a virtual circle. 4 steps that overlap to make that complete whole circle that is your business’s financial goals.
Let’s take that first step!
STEP 1: OFFERS AND PRICING STRATEGY
Step 1 is all about defining your offers. What are your offers? What packages do you want to sell and what are your price points that will make you profit? It’s a really great place to start to define everything, not only for your clients but also for yourself!
Ideally, you want to have packages that cover all the different stages of a customer’s growth and journey. By offering a range of offers that go from low commitment to high impact it allows customers to still engage with your business, even if they’re not truly ready to commit. It also builds trust. Ask yourself, how do my customers go through various stages of working with me and what are the key catch points of their journey?
Even though your clients may be very different to each other, you can still create a standard package and adapt it to the client once they are on board.
As part of defining your packages, you need to be able to explain the transformation you’re offering the client – their before, during and after working with you. What does that really look like? This will help them to emotionally invest in your offers.
Once you’ve defined your offers, look at your pricing strategy:
1. List all your expenses for the year
Write all your costs for the next year, including salary and tax. Be sure to include your recurring costs, plus any investments. It’s really important to include a monthly salary at the get go. Even if you’re not able to pay yourself yet, it’s the best way to commit to yourself, build up a cash flow and see what profit you have left. If you don’t know how to project for the year ahead, replicate your costs from the previous year.
2. Allocate an expense percentage to each package
Each of your revenue streams needs to cover a percentage of your expenses. In the same way you might plan a training event where you evaluate the expenses of venue hire, food and refreshments to work out what you need to charge to break even and to make a profit.
For planning your whole year’s revenue, don’t look at each sale. Distribute your costs through all the packages. If you have 3 packages and your expenses are 100k, your first package may cover 15% of your expenses, package 2 might be 40% and package 3 the remaining 45%.
Weight the percentage according to how important the package is to you. A big offer can take more of a percentage of your expenses. Make sure you also readjust as you move through the year depending on what’s happening. It’s so important to stay on top of your revenue so that you have the best chance of making profit, taking a salary and being able to pay your taxes.
Two resources I recommend to my clients are Profit First by Mike Michalowicz. It’s full of great ideas about managing cash flow and achieving profitability. The other is my conversation with financial strategist Anna Moore. She gives some amazing insights into why you need to start paying yourself a salary as soon as possible.
3. Evaluate Sale Revenue
Evaluating your sales revenue keeps you on top of knowing when you break even and when you make profit. With your first package you might need to make 15k to break even. You then add profit on top of that. Let’s say you want 40% profit. Add 40% to the total and from here you can work out how many sales you need to make.
4. Number of Sales
When you know what your total figure is to reach your revenue goals, you’ll need to work out a unit price per customer. How many customers do you need to reach your targets? Say it comes out at 50 clients for that particular package. Is that reasonable for you? Can you attract 50 clients? Have you got the energy to physically deliver that product 50 times a year?
5. Adjustments for Sustainability
If you find that you can’t sustain 50 clients for that package, then make adjustments – your expenses, the distribution of costs or pricing. It’s important to make sure that you plan pragmatically to deliver what you want and are capable of delivering within your lifestyle. It also allows you to plan your growth year upon year.
STEP 2: POSITIONING STRATEGY
If you’re new to business, step 2 is the best place to start this process. Your first task is to define your ideal client. You must be super clear about who they are.
If you’ve been in business a while, don’t be caught out by thinking that you know exactly who your clients are if you haven’t reviewed the market in a while.
Revise your target audience, check that your products are still relevant and look at ways to adapt them for those clients. You need to get clear on 4 things:
- Define your ideal client
- Define your value proposition
- What is the transformation you offer?
- What language does your client use and how can you position yourself where they need you to be to want to buy from you?
STEP 3: Marketing Strategy
Marketing is all about getting visibility where your clients hang out. The most common ways to do this is to see who your competitors are. Find out who can be strategic partners? What associations and events do your clients attend? What do they read and listen to? Media? Podcasts and blogs?
And then ask yourself the big question: How am I going to get their attention?
For solopreneurs and small businesses, marketing strategies are generally implemented by 10 key methods:
- Networking
- Exhibitions or events
- Public Speaking
- Strategic partners
- Referrals
- PR and media
- Affiliate marketing
- Paid advertisements
- SEO
- Direct marketing
Choose 1-3 methods and stick with them. It’s important to only use a few, rather than spread yourself too thinly. Stay with what works most effectively to create consistent visibility in front of your audience.
STEP 4: LEAD GENERATION AND CONTENT STRATEGY
Don’t confuse marketing with your content. Marketing is how you get ‘out there’ and content is what you put out there. Marketing first, content second.
It’s no good having great content if there’s no one to read or listen to it right?
Content is used to position you as the expert, the go-to person for your subject. It also nurtures the business relationship with people. It builds trust and allows people to get to know you more by consuming content before buying.
Your content should be your lead generator. Use it to grow an email list, to get attention, have people read a blog, watch videos AND sign up! When people sign up they are interested in your subject and how you can help them. For example, hold a free webinar with a title that attracts potential customers. Once they sign up you can introduce them to your packages and other services.
It’s important to be really clear about the journey you’re taking the client on through marketing, content and free resources. Be sure to plan every quarter of your year with a calendar. This will allow you to focus your efforts on one package and help you to work out how many people you need across each package to meet your revenue goals for that quarter.
When you design your revenue goals, don’t leave them alone for the whole year. It’s like growing a coffee plant. Nurture it every month so you create the best cup of coffee when it’s time for harvest. You feed it, water it and adapt your efforts as needed.
The same applies to your revenue planning. If you plan and it doesn’t work out, change step 1, adapt your pricing, spread your prices through your packages, spread your expenses differently or work out ways to reduce them. Keep it fluid and adapt to the circumstances. The same with your marketing. Is one strategy working better than another?
Pay constant attention. LIVE the process monthly, not just once a year. Use the right strategies and implement them to reach that financial success.
And now we have come full circle! Your offers, what you’re selling, your pricing and how you get your content out there in front of your target audiences.
I hope that you now have more awareness about what to do, how to do it and what steps will help you reach your goals.
To summarize the 4 key steps to reaching your revenue goals. You need to define:
- Your offering and pricing strategy
- Your positioning strategy
- Your marketing strategy
- Your lead generation and content strategy
I can’t stress enough the importance of planning your revenue goals.
If you’re struggling to put everything into action or you don’t know if you’re doing it correctly, then I highly recommend that you reach out to me. This is exactly what I do with my clients. We go through everything thoroughly and I help them choose the right strategies for pricing, positioning marketing and content.
When you work with me, you also get access to my personalized financial spreadsheet. With no hassles of figuring out the math yourself, you can create a plan that works for you and adjust as you see fit.
If growing revenue and profitability is a top priority for you, please reach out. Wherever you are at, I can help you implement these steps and support you with other challenges.
Promise me you’ll block out the time to do this planning, to commit to your business, to support your family, and support yourself, so that you can do everything in life that you want to achieve.