Recently, I was in a Facebook group where someone posted something about 6 and 7-figure businesses and all the hype people use around that in their marketing. This person talked about how they asked somebody about the profit margin in their business only to learn that their 6- or 7-figure business had a profit margin of around 15%.
I wanted to address this because sometimes marketing is misleading. I am a big believer that success leaves clues.
5-figure weeks, 6-figure launches, 7-figure businesses. It’s all about the money and yet, it’s not really about the money – if that makes sense.
If you are a good business owner you’re building your business from a place of integrity, and that’s not about the money. Even though you want to make money in your business, money is not the only driving force. The driving force is your idea and your passion for creating.
When I owned my retail store, we did over a million dollars a year in retail sales – like $1.2 to $1.3million in hardware sales. But, the net profit on those sales was just a fraction of that.
When people say they have a 6- or 7-figure business, I’m always a little skeptical of what’s not being disclosed.
I have a multi 6-figure consulting business, and I also spend a couple hundred thousand a year on the payroll for my team. In addition to that, I pay myself, and I keep money in the bank so I can operate the business well and be responsible.
Have you ever considered that if you’re making $50,000 a year clean – you may be doing better than some of those people who claim to have a 6- or 7-figure business?
When people say they’re generating a certain amount of money in their business, they are not literally making that amount of money. That’s what they are generating in sales. After you take the expenses out, the profit is what is left over and that is the mark of a successful business.
Everyone is chasing these numbers yet when you hit 6-figures in your business, or 7-figures in your business – nothing changes. You are still you. You don’t change because the number on your sales report changes.
If you’re chasing the 6-figure dream and spending everything you make to get there, nothing changes. If your money story is all messed up, and you start making more money, it just means you’re going to spend more money. It doesn’t mean you’re going to keep more money.
I plan on talking about this at my event in Ottawa, ON, Canada – Money, Mindset and Marketing.
But right now, what I want you to think about when you listen to how other people are doing in their business is this:
What are you trying to create?
There is so much more to a successful business than just 6- or 7-figures. The real question is who you become in the process, and whether or not your business is profitable. If you’re making 7-figures and spending 7-figures plus $1 – you’re in the hole. And that’s not a fun place to be.
Have you hit the 6 or 7-figure mark yet? How did you get there? Leave a comment below.