In case you missed my last post: Why BVFLS pricing is cratering (not for all, but for many). If the value we deliver to clients is obvious and similar to what others like us do, we are likely providing commodity services and competing on the basis of price. But if we can deliver hidden or even unexpected value that differentiates us from what others do, we can earn “excess profits” that are not likely to be eroded by competition.
On to this week: Considering I have an MBA with a concentration in Finance, a CPA license, and a CVA designation, I have never felt like I was much of a numbers guy. But when it comes to my valuation practice, my coaching business, AND my quality of life, I do believe in monitoring the numbers that matter. So I track five KPIs on a monthly basis that tell me how these things are going.
Here they are.
#1 – Leads and prospects
Incoming leads and prospects are the lifeblood of any practice.
A lead could be an email address, a voice mail, a LinkedIn message, a Facebook message (for those of you prospecting on Facebook), or a booked sales call.
It doesn’t matter which one you choose, just pick a source of future business that has the most meaning for you. And then commit to tracking and growing that number every month.
#2 – Revenue
The next monthly number I track is revenue collected.
I don’t think this one requires any further explanation.
#3 – Profit
I track profit, both as an absolute dollar amount and as a percentage of my revenue. Bringing in a lot of revenue is great, but as some have said: revenue is vanity, profit is sanity.
The major cost in my valuation practice is reference and research subscriptions.
The major investments in my coaching business are virtual assistants and educational materials.
#4 – Focus days
Focus days are a concept Amy and I got from our time at Strategic Coach. They are the number of days I spend focused on my top income-producing activities. To concentrate my efforts, I have structured my typical workweek so that all of my income-producing activities generally happen on Mondays and Tuesdays (and the first Friday of each month for my INSIDER interviews).
The goal is to spend as much work time as possible as focus days.
Time spent doing admin, CPE, etc.—though necessary for keeping the doors open—does not count here.
#5 – Free days
This is another Strategic Coach teaching. Free days are days not spent thinking about work, dreaming about work, or checking email, voicemail, LinkedIn, or Facebook. Just time spent with family, friends, or developing hobbies.
This one is hard (as a solopreneur, any/every day can be a work day if I let that happen), yet free days are super important. Because I can’t be at my best for my clients unless I am rested, relaxed, and recharged. One way I try to create more free days is to take off the 13th week of every quarter and go off-grid. It’s currently my Achilles heel (i.e., I don’t always succeed), but I’m working on it.
That’s it for me … those 5 numbers.
What about you?
What are the metrics you faithfully track?
Don’t be good. Be great.
PS – Whenever you are ready, here are 4 ways I can help you build/grow your BVFLS practice:
1. Join Practice Development ROUNDTABLE
It’s a new Facebook community for BVFLS professionals who are collaborating on how to turn the practices they have into the practices they want.
2. Download this Find Your Niche infographic
The riches are in the niches, as they say. But what’s missing is a process that can help you identify your niche. This infographic is the missing process.
3. Take a free Practice Self-Assessment
I have 10 quick questions, and your answers will help you get a sense of how well your practice is working for you.