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Smooth Out The Income Roller Coaster
If you're running a coaching, training, consulting or speaking business,
you've probably experienced the "income roller coaster". When the business
is quiet, your income drops, so you're out there marketing to get
future business. When that new business comes in, your income rises sharply,
but you're no longer out there marketing, so the following few months look
bleak again.
More importantly, this affects your cash flow.
If you've experienced this roller-coaster cycle, you know that it doesn't
affect only your income - it affects your cash flow, which is much
more important. Business consultants can readily quote case studies of
businesses who kept making profits, but went broke because they didn't
have sufficient cash flow to operate on a day-to-day basis.
In other words, when business is quiet, money is tight. When money is
tight, you naturally cut down on expenses. And the easiest expenses
to cut are the non-urgent expenses, even if they are important. So
while you continue to pay your telephone bills and insurance bills, you
might cut out:
- Fees for networking events that could bring you new clients;
- Travel costs for sales meetings with clients;
- Production costs for new products;
- Registration fees for important conferences and seminars.
In the longer term, these things will hurt your business - sometimes
fatally.
Can you smooth out the roller coaster?
On the other hand, what would it be like if your business didn't go
through these cycles over and over again? What if you knew that your cash
flow throughout the year would be reasonably consistent? Or at least, what
if you knew that every month - yes, even the quiet months around Christmas -
would bring you a minimum level of income, sufficient for looking after
the foundations of the business?
What would you do differently in your business if you weren't going through
a constant "feast or famine" cycle? You wouldn't
have to scrimp and save in the quiet months. You wouldn't have to worry
about the income from the next round of bookings. You wouldn't have to
give up important but non-urgent things.
Create other income streams.
There's no getting away from the roller-coaster cycle in some parts
of your business. No matter how hard you work, you probably won't get
booked much in Australia in December and January, except as a department
store Santa Claus.
So look to create other income streams in your business. This will give
you sufficient "core income" to look after the basics in your business.
In other words, you don't eliminate the roller coaster, but you smooth
it out by not relying on it for all your income.
For example, suppose that you sold an on-line membership subscription
package as part of a training workshop.
Now, instead of creating a single income opportunity (the workshop),
you have recurring monthly income from the membership fees. Although
the individual subscriptions might be low compared to your speaking
fee, this is passive, recurring income.
Use our Fast Forward package
Our Fast Forward Web site package includes many tools
for creating passive income, including:
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