So, you are thinking of starting an online business and screwing the 9-5.
You’re gonna work from home and be your own boss because you want to have more time with the kids and contribute to the family finances.
Or for those playing along at home who have already done that, perhaps you are finding it is actually a lot harder, than you expected. Perhaps your business is not where you want it to be in terms of sales and income.
It is a despairing thought right?
Kinda sucks.
You’re in this because you want to live a life with more freedom and income, except, you are working even more and nowhere near out earning your old income.
Don’t worry, you are not alone.
Research agrees that being self-employed is a tough gig and most businesses fail within the first year.
I get it, I’ve been there.
Six years ago, I was a new mum dreaming of starting my online business. Like most mums, I thought selling a baby related product would afford me a life of being a badass screwing the 9-5. I couldn’t find what I wanted to buy for my daughter and felt for sure that was reason enough to take the jump.
I stuck with this business for 4 years, thinking at the end of the rainbow there would be a pot of gold. All the time using my freelance website and graphic design biz to help pay the bills.
The first two years I lost money because, as you know, you need to buy products up front in order to be able to sell them.
That wasn’t fun but I knew it was pretty typical in retail business so I pushed on.
It wasn’t until the end of my third year, I stopped and deeply evaluated where I was and where I wanted to go.
I broke it down like this:
The conversion rate for online retail websites is on average 2.5%
That means for every 100 people that visit your website 2-3 will buy from you.
Shall we round that up to 3 people for this exercise? Ok.
3 people buy 3 products for $20 each.
Awesome. You’ve made $20 per sale right?
No.
Out of the $20 per sale you need to spend the following to stay in business: $10 needs to go straight into replenishing your product (assuming you are working on a 100% markup)
To get 100 visitors to your website in the first place you need to allocate funds for advertising and marketing campaigns. Truth: customers do not magically just find your website.
To run your business you need miscellaneous items like bubble wrap for packaging, envelopes/packaging, stickers, business cards, stock photos, graphic designers etc
Plus you have service fees like hosting and domain, Paypal fees, accounting software fees, social media scheduling software fees.
Sometimes there will be a difference between what you charge for postage and what the customer pays or you’ll need to replace and resend lost items
Don’t forget, you’ll need to pay your tax to the ATO
If you are buying products from overseas, the exchange rate is crap right now, that will eat into your profit too.
So, from all that, let’s say your outgoing costs to stay in business are $15 out of every $20 product sold.
That means, there is $5 left for you to pocket.
Out of those 3 sales you have profited $15 as your take home income.
But wait, what if your product doesn’t sell and you need to have a sale? When you discount your $20 product down to $15, you will only be breaking even. No profit for you.
It gets down to the wire pretty quickly, doesn’t it?
We haven’t even considered the time factor yet. Or the amount of cash you’ll need in the first place to bankroll your business and purchase products to sell.
But in a nutshell we need to source a manufacturer/supplier, pay money upfront to get products, (usually there is a MOQ) check stock when it arrives, sort out inventory, house products, start the selling/advertising/promoting process, pick and pack, book courier, re-order stock, attend to customer service enquiries/issues. etc. etc. etc. Well, that was tiring just writing that!
I estimate that it probably works out to be 30 minutes per product.
So, in essence, we are working for one and a half hours and making $15.
Now, at this point most people will knee cap this business module and move on.
I did.
But don’t give up on your dream of being your own boss or believing you can have an online business which affords you to work around the children, have a life with freedom unshackled from the 9-5 grind, with an uncapped salary, whilst running a business that is aligned with your heart and soul.
I am living proof it is achievable, albeit after much test and measure.
Us Mums who dream of running our own online business are determined ninjas, we are motivated mofos, we know damn sure there is a way to run a successful and profitable business to achieve our jam, we just need to find the right key to unlock the door.
Listen in. I am going to tell you the secret sauce to buck the trend of potentially becoming a dire statistic.
Let’s look at this smartly, because a successful, rewarding business can be achieved.
The secret is unlocking additional income streams that allow you to spend 80% of your time ‘on’ the business and not ‘in’ the business.
It is about income streams which allow you to highly automate and systemise.
And, while your business is working for you, you are out, spending time with the family and enjoying life.
Create a product or a service just once, and sell it over and over again using a system and automating.
Focus 80% of your time growing your audience.
That is how you create freedom + profit.
When I found the key I went from not earning a lot in 4 years to selling that business and creating a business that hit 5 figure months within 6 months of starting.
Imagine if I had of quit way back when and went back to work. Imagine what I would have missed out on if I gave up searching for the key.
