Tips & Tricks

Running 2X 8-Figure Businesses

By October 30, 2020 November 20th, 2020 No Comments
 

I have two main companies that I’m involved in, one is amazing.com, and the other one is an e-commerce business. So I want to let you know what it’s actually like running these kinds of businesses. I want to let you know a couple of things check this out.

So Tuesdays for me normally are checking stats. I’ve got a couple of important meetings, so today was regarding this e-commerce business. Here you’ll notice yesterday’s sales. So this is yesterday, let me see October 19th, so I typically check this almost every morning.

This is for the e-commerce brand that I’m involved in. I’m co-owner with my business partner Charles Livingston on this. Yesterday we did about $52,000 in sales, which is pretty good for us because if you take that over a month, that’s about a million and a half, which is about where we’re now with this business.

We’re trying to get this thing up to two million dollars a month. That’s the target that we’ve set. The goal is probably to sell this eventually, so we’re talking with some investment banks about that kind of thing. And that’s about the target we need to be at.

So a few things I want to show you here, first off recurring billing. So for yesterday, over 20 grand in recurring billing sales. We’ve been building this up as much as possible. We’ll sell single units of the product, and then we try to convert those people into subscription sales. An online store is a little bit misleading because this plus Zipify are two different checkout systems, but they’re the same.

They’re just people buying stuff, and the only difference is that one runs throughZipify, and we’re able to put one-click upsells in front of them. With the online store, we’re not able to do that. So this is more sort of ad-driven sales, and these are more organic salespeople just buying stuff on the website from email promotions, that kind of thing, online store sessions.

So these are up, that’s awesome, returning customer rate. Yesterday was a big subscription day, so 75 percent of these sales are from existing customers, not new people’s average order value. We’ve been trying to bump that up, so we’re almost at 70 dollars. We were as low as around 60 dollars, so we’ve been adding upsells doing in-cart order bps and that kind of thing to get that ramped up.

Total orders were down, I think, this is comparing it to the day before so compared to October 18th. Total orders down a little bit. Online store conversion rate is pretty much never correct because many of our sales run through Zipify, and there’s a lot of different sorts of tracking things going on.

So we pretty much can’t use this store conversion rate, we either have to look at our ad account, or we have to go check out google analytics or something like that—all in all, a great day yesterday for the store. Typically we’ll check that out.

Another big thing today is we had our weekly marketing meeting for Amazing. So I found out a long time ago that you know, I’m not a huge fan of meetings, but you know some things you have to do. Some things you have to put regularly on the calendar. Otherwise? Things start falling apart. And one of the big ways that I’ve grown and built businesses, Amazing, this e-commerce brand, is marketing. That’s one of my sort of core expertise.

So I make sure that I’m heavily involved in all the marketing stuff at Amazing, and we’ve got a good sizable team, so I jump on the marketing meeting with them every Tuesday. We review kind of the general agenda as we take a look at our dashboard. Essentially, how did things perform last week? So we’re tracking sales, we’re tracking social media follows email performance, all the different promotions, and products that we’re looking at.

Overall how did the marketing team do driving sales and also increasing engagement everywhere? How well are we using our assets? So we do that, and then we review the calendar.

Another big important thing that if you’re running a business and you don’t have a regular marketing calendar that’s at least 30 days out, ideally a couple of months out, but at least 30 days out, then you’re missing opportunities.

You know you want things on your calendar like we’re running this promotion this week, we’re going to tap into this holiday. You know we’re about to get into the holiday season for everyone, and so things like what are we doing around Black Friday, Thanksgiving, Christmas, Halloween, all that sort of stuff. How are you leveraging all these holidays and events to give people more reasons to buy things? So we look at that.

What other content are we producing and putting out there because otherwise, you’re just doing everything last minute and you’re inevitably going to miss out on sales. So we take a look at our dashboard, our calendar, then we have a kind of an open session.

Is there anything we need to talk about that we haven’t talked about? We’ll jump into a couple of different topics there. Today we didn’t necessarily have anything super major that popped up, or everything is running as planned. Then one of our team members Whitney, actually recaps the actions.

What does everyone do after all this stuff we talked about? What is everyone actually going to do? So it doesn’t just, you know, go to a bunch of discussions and then everyone kind of goes back to doing what they were doing before, we want to make sure that people are accountable.

Part of her role is to track all that stuff and follow up with people, including myself, so she also follows up with me to make sure I’m doing everything I said I would do.

So first I went to the marketing meeting today, then pretty much immediately after that was another big one, except this is more of a monthly finance meeting for Amazing.

You know finance used to be a nightmare.
Like I don’t know about you, but it always felt like such a nightmare, accounting, and finance, we had money coming in, but we never knew where it was going, any of that kind of stuff. I used to beat my head against the wall, trying to figure this stuff out for a good couple of years. I was like, how do you do this without fear, feeling like you’re spending your whole time doing this? We even had a team of nine people in finance, including a CFO and tons of other people that were all managing this stuff internally, costing us a ton of money, and it was still a nightmare.

I talked with a guy who actually ended up giving me some really good advice. He says, look, you know what you need to do is hire an outsourced CFO. There are lots of companies that’ll do this for you. They charge you on an hourly basis, hire an outsourced CFO to kind of manage and clean everything up and then just do a monthly finance meeting, maybe a weekly check-in, but really that monthly finance meeting it may take three or four hours to go through everything. Go through all your financials, ask all the questions, make sure everything’s where it’s supposed to be, and then you’ll have a much better life.

So I did that, and that completely changed everything. It took probably about a year of going through that system, and now our finance meeting is less than an hour because we’re meeting regularly, everything’s cleaned up, and everyone’s doing their job. But having that monthly finance meeting, it’s absolutely critical.

The other big piece that we put in place, that we kind of roll into this is a rolling forecast typically forecasted 12 months or at least till the end of the year, of our financials, what do we think we’re going to bring in every month? What do we think we’re going to spend in terms of the cost of goods sold? Operating expenses? How much profit do we believe we are going to produce? We forecast out all that sort of stuff each month we review, which is a big part of the finance meeting is how did we do versus how did we think we were going to do? What does our forecast say versus what are the actual numbers?

We review those two pieces of data because it keeps us honest.
It doesn’t let us, you know, think that, oh, this was a pretty good month, but we were way short of what we thought we were going to do. So that’s another big thing that we do at this meeting. That’s the main focus, but yeah, we review typical things like profit and loss, statement balance sheet, cash flow statement, and all those usual things. So if you’re owning a business or going to own a business and you’re not doing that, you’re crazy.

Definitely want to put that in there as one of the first things you do. Whether you’re just reviewing it with your accountant or CPA, or you actually have an outsourced CFO, or if it’s just you and a business partner, totally cool.

So for the e-commerce brand, we keep that thing super lean. It’s just me, Charles, Michelle manages customer service. Then we have an outsourced agency, sort of one guy, but he has a team behind him that runs all of our ads, and we have a bunch of other like sort of outsourced customer service people, but that’s really it.

So with the finance meeting, we also have an outsourced CFO for that business that only costs us about 1500 bucks a month. He prepares all the financials, and then Charles and I review the stuff ourselves, so that’s all that’s involved in that finance meeting. You don’t have to have a whole team or anything like that, but the discipline of reviewing every month what did you think you were going to do versus what you actually did is absolutely critical.

So that was one of the big things we did today, and then part of the rolling forecast part of this whole thing is that you’re forecasting out with all this new information. You know what we did last month, we know what we did all the months before, what do we think we’re going to do now for the next month or a few months after? So we typically update that so that it doesn’t become stale. We’re constantly updating our forecast to know what will be coming down the pipeline and compare that to how we’re actually doing. We want to find out like hey, we said we’re going to make this amount of revenue or this amount of profit for the whole year, but we’ve either under-performed or over-performed. What do we need to adjust?

You know, part of the forecast part of it, is the actual stuff that we’re doing. What do we need to adjust for the rest of the year to make sure that we actually hit our numbers?

A big thing to consider, you know when you’re running a business, is you know you could basically sell the business, take that money, put it in some investments, and if you can earn a higher return that way, there’s no reason for you to be running a business. The business has no purpose.

It needs to be earning a higher return than adjusted for risk than you could get in the stock market. For example, say the stock market historically returns seven and a half percent after tax. You are running a small business that has a lot more risk because it’s smaller and because it hasn’t been around as long as, say like a massive company that you can invest in like Apple or something. You need to be earning probably 15, 20, 25, 30 returns on the value of that business.

Otherwise, your business has no purpose, so you should earn those kinds of returns, but that requires you to be honest with yourself. Look at the numbers. I used to be like the ostrich. I know you’ve seen the picture. I’ll see if I can pop it up here, but the ostrich with his head in the sand, which used to be me with the financials because I didn’t want to actually look at the performance because it was just too overwhelming. I didn’t know where money was going, it always felt like we were bringing a lot in, but I couldn’t really tell where it was going, but now that we have all this dialed in, it feels so much better.

It’s very predictable. We know what’s happening. Sure there’s always ups and downs, but at least we have our hands-on and know exactly what’s happening. If you’re kind of nervous looking at your numbers, that kind of thing, definitely want to get all that sorted out. Incredibly important, because at the end of the day, that’s how you measure your business success. How well are you doing financially?

There’s a lot of other things, whether you’re taking care of customers, all that sort of stuff, but all that should funnel into your financials at the end of the day. If your financials aren’t working well, there’s some piece of your business that’s broken. Either you’re not doing well with customers, you’re not selling a good enough product, or you’re just spending money blindly and wasting money all over the place.

It can be many different things, but you need to know the score if you’re going to win this game. Those are the main things, and you know today got many other things going on, but those are the main things that I’ve done so far.

Running these two businesses is not like you know I necessarily have to work, you know 20, 24 hours a day, that kind of thing. I still work a lot. I work pretty much seven days a week, depending on what I have going on, because I love it. I love building these businesses, impacting lots of people. It’s exciting, it’s fun, it’s a big source of growth for me, but it’s not really that crazy on a day-to-day basis.

Just kind of like brushing your teeth, you can’t go without some of these things. You know planning out your marketing, or planning out the finance, and you know sort of not doing it for months, and then just trying to make it all up in a short period.

You can’t be like, well, I’m not going to brush my teeth for a couple of weeks, but I’m going to brush them for four hours one day, and that’s just not going to make up for it, that’s not how it works.

With a lot of things, it’s just a sort of daily maintenance. It’s like watering the plants or brushing your teeth. You’re just constantly doing this sort of daily maintenance, then once you get through that initial hurdle of cleaning everything up, you know it becomes a heck of a lot easier.

So hopefully, this gives you an idea of what it’s like actually running two eight-figure businesses. Just so you know, I’m actually the CEO of Amazing. I’m a co-owner and run all the marketing and stuff for the e-commerce brand, but yeah, to give you an idea of what it looks like, there it is.

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