127 – Wealthification Part 10 – Exercise

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Back to Start: Part 1 – Introduction
 

Wealthification is just one of the many courses inside SuperFastBusiness.com. Join me inside this Internet Business coaching community so that I can help you profit faster: Click Here

 
Tweetables:
Focus on the customer. [Click To Tweet].
Set goals. [Click To Tweet].
 
Download Wealthification Spreadsheet here
 
Do you prefer text? here you go…

James Schramko here and welcome to the Wealthification exercise.  

 
Action Step

What we’re going to do in this module is put it all together and we’ll do a little bit of work.

 

 

I’m going to show you my Wealthification spreadsheet.  We’ll just do a basic one today but you can develop it on your own. I’m giving you the Excel spreadsheet so that you can analyze your own business and start to develop a really useful reporting tool for your business. In the next section, you may want to increase the size of the screen if you’re watching the video so that you can see as I go through the exercise.

 

 

Okay, in this example, what we’re going to do is put in last month’s numbers for our two business divisions and we’re going to analyze them.

 

 

So in the first business, let’s say we did $10,000 worth of sales and in the other business, we did $30,000 of sales. Now let’s say in the first business it cost us $4,000 to make those sales in marketing and delivering those services and in the other business, let’s say it cost us $12,000. Now in the first business, we spent, (out of a 188 hours that we get) let’s say we spent 80 hours in that one and 100 in that one.

And what we’ve got here is the hourly rate that Business 1 is worth to us, $75 an hour and in Business 2, where we think it’s a pretty good business because we made quite a few sales, the profit was good, it was three times as much as the first business.  The hourly rate on Business 2 is substantially better.  It’s $180 an hour.

So not only is it bringing in more sales, it’s bringing a huge amount of profit even though it’s taking up more than half our time, it’s giving us most of the money.  So what we do is we have a look at the ‘after’ scenario and let’s say we back off a bit on Business 1 and really ramp up Business 2.

 

 

Let’s say we’ve given less attention to Business 1 and it’s now doing $8,000, let’s say it still costs us $4,000 but we’ve pulled back a bit and we’re  spending only 60 hours a month on it.

On Business 2 though, we spent more of our time there. We’ve actually now put 120 hours a month and our sales have gone up because we’re focusing on it, it’s $45,000 and our costs have gone up too $20,000 because we hired few extra people and did some things.

But have a look at this, our hourly rates have gone up to $208.33 and we’re spending more time on it so our profit went up from $24,000 up to $29,000 so we’ve got a substantial difference. Our overall rate has gone up, our time spent in the business is exactly the same but we’ve made more profit and that was because we started focusing where we could get the best return.

 

 

Know Your Priorities

So we just look at our top priority.  Our top priority for Business 1, and we can get some hints from here, might be just to ‘sustain’, we don’t want to do too much.  Second priority would be to ‘call past customers.’

And for our Business 2, what we really need to do to really increase that business is we need to ramp up our ‘marketing’, so we’ll do some marketing there,  and we’ll also hire some ‘people’ to deliver the goods or services and we’ll spend some time fine tuning our ‘systems’.

So there is effectively our actions list and if we do these actions, we’ll get this result, and that is a very simple Wealthification analysis and it helps guide you in terms of what you should be spending your time on.

 
Create Your Zectrac Circle

What I like to do then is to create a zectrac circle so that we can really dig in on our business and I’ll show you what that looks like.

 

 

So what is a zectrac circle or a chocolate wheel?

 

 

We saw in a previous module the chocolate wheel concept where we have our business with complementary sections.

So let’s just think about this for a minute.

We start off with our own service. Probably one service or maybe two services. That’s a typical scenario and quite often because we are entrepreneurial, we start to add services.  So let’s say in this example, we have a service business, a product business and a finance business and they sort of all fit together from the same overall market or segment and we’re able to have that customer move between section to section of our business and make extra profit.  Remember how that increases the transactions per customer and that gives you a much better performance.  We saw that in the cashflow module.

 
Focus On The Customer

So just to put this in perspective, we started with one business and then we grew an extra few businesses and now our entire business and now our business is far more profitable. And remember, we have to put the customer in the middle.  Focus on the customer.

 

 

I really want to stress this.  The big key to Wealthification and the thing that’s helped my business the most is putting my attention on the customer that I already have and helping them experience different services and different products and to be able to experience all parts of my business.  It’s really good for them and it’s really good for me.

So this is the exercise now:

• Take your businesses from the spreadsheet
• Write them on your own zectrac circle
• Put the customer in the middle
• Take a picture of it and perhaps make it your screensaver

This will help you focus on your customer and your business. And if you need the prompt, put your actions and list them down the side there so that you have your actions right there on your computer

 

 

Set Goals

What I like to do is put my goal. In the case of many of my students, they’re still looking for that first million dollars. But it won’t be long ‘til they get there.  I’ve been able to do it and I’m pretty sure just about anyone who applies the Wealthification formula has got a great chance of doing this.

And remember your multiples. If you have a profit of a million dollars, you can probably sell for five.  I hope you’ve enjoyed the training.  Be sure to leave some feedback.  I’m James Schramko, signing out.

For more advanced training I recommend you join SilverCircle.

Wealthification is just one of the many courses inside SuperFastBusiness.com. Join me inside this Internet Business coaching community so that I can help you profit faster: Click Here

 
Back to Start: Part 1 – Introduction

 

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