Do you know the difference between a 6-figure revenue versus a 6-figure profit? Many new business owners make the mistake of not knowing the difference between the two. And by not understanding your numbers, it is impossible to run a business. In today’s episode, host May Yeo Silvers talks about the numbers that every eventrepreneur must know in order to maintain and run a profitable business.
In terms of numbers related to your business, it is important to get familiar with and focus on a few terms. First, you need to know what your operating costs are. Aka the cost of doing business. May explains that operating costs are broken down into two categories: fixed costs (anything related to staying in business) and variable costs (costs to bring in business). Next, you need to understand revenue, loss, profit, and net income. Revenue is all the money that you bring in from doing business, but it does not equal the amount that you take in profit. For example, if you brought in $10,000 of revenue, but your operating costs were $5,000, that means you only have $5,000 left over in profit. However, this can change from month to month because your operating costs are subject to change. So to calculate your net income, you need to track your profit and loss on a regular basis. That way you know how much money is in your bank account and you avoid making any bad financial decisions.
While many people fear numbers, it is a necessary part of running your business. Tune into this episode of The Unstoppable Eventrepreneur™ for a deeper dive into the numbers every business owner must know so that you can run a profitable business.
Quotes
• “To me, if you don’t know your numbers, you don’t have a business.” (02:01-02:05 | May)
• “Do you like money? Do you like to live your best life doing what you love most? If you do, let’s develop a different relationship with numbers.” (03:12-03:22 | May)
• “Revenue basically means the money that you collect every time someone pays you for your service.” (09:54-10:00 | May)
• “If you don’t know your profit and loss you will have no idea how much money your business has at any moment in time.” (16:42-16:53 | May)
Links
Connect with me at: [email protected]
Website: events4anyone.com
LinkedIn: www.linkedin.com/in/mayyeosilvers
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