I have a saying that we am prone to repeating often: “The mathematics is always the mathematics. inch It is the quantifiable version of “the truth is information, like them or not. inch Both facts and mathematics are very important to running your business and you would be surprised how many internet marketers run their businesses without them. Administrators inside large firms is as guilty as solitary entrepreneurs.
To illustrate my point, let’s say you’re a massage hypnotherapist charging $70 per for a 50 minute hour and you perform 출장마사지 your service in your patron’s home or job. How many hours each week would you have to work and how many massage therapy would you have to perform each week to make the same sum of money as you had a $50, 000 a year job with health benefits and a two week vacation?
The answer IS NOT $50, 000 or $70 or 52 = 14 hours and 14 massage therapy each week.
There are some other cost and time components to consider such as:
Time to and from each client
The set-up and grab rest time at each client
Admin and marketing time
Admin, marketing and self employment tax expense
Cost to journey to and from each client
The cost of health insurance
So let’s make some assumptions:
It takes you an hour per massage session to journey to and from the consumer’s location and set-up and grab down your equipment.
It’s an average 10 miles round trip to and from each client and it creates. fifty-five per kilometer in expenses such as gas, maintenance, wear on the vehicle and loss of vehicle value. This is $5. 50 in costs per appointment.
It costs you $7, 900 a year ($150 per week) in supply costs, marketing costs, admin costs and self-employment taxes.
It takes you four hours each week for admin, marketing and networking tasks.
It costs you $4, 680 a year ($90 per week) for a health insurance policy.
Now let’s execute a little mathematics.
To create a $50, 000 salary equivalent, the revenue need would be $50, 000 + $7, 900 + $4, 680 = $62, 480.
The internet revenue per massage after expenses would be $70 — $5. 50 travel = $64. 50 per massage.
The number of massage therapy necessary would be $62, 480 or $64, 50 or 50 = more than 19 massage therapy each week.
The time necessary 19+ hours for massage therapy + 19+ hours for travel and set-up + 4 hours for admin/marketing = about 43 hours each week.
So far, so good. So now the question has to be, is it reasonable to be able to consistently have 19 clients each week, and is it reasonable to be able to schedule that many clients to meet your schedule and their schedules? My guess is that it would be a challenge to manufacture a business like that and certainly not one that could be built overnight.
The purpose of this exercise is to start you thinking about the viability of your business decisions and there’s no substitute for doing the mathematics in advance to increase the likelihood positive results of your decisions will be as you intended. So some simple questions:
What is your business’s or product line’s breakeven unit or dollar volume?
What is the profit level you would project from your current business, pricing or marketing initiatives.
How much additional business wouldn’t it take to rationalize an investment in your business — equipment, personnel or marketing?
How much cash do you need arriving every month so you don’t find yourself with cash flow problems?
How many days of inventory do you already have got on hand?
How many days does it take to collect your accounts receivable?
What is the dollar value of accounts with balances greater than 60 days old?
These kinds of questions are just as necessary to the operation of your business as the questions above the massage hypnotherapist would need to answer to understand his/her business. If you don’t have the answers to the above questions, you might consider obtaining them today. You’ll bring in more money and have less business risk.