Do you know the easiest way to make extra money from your business?
I often meet business owners who want to make more money from their business, but they’re not really sure how they can achieve this. In the video below, I’ll show you how…
The Formula To Finding Hidden Profits
So, how do you extract more value from your business? The strategy that I’m going to introduce to you involves compounding. It was Albert Einstein who said that “compound interest is the eighth wonder of the world.”
If you want to grow your business, it’s quite risky to do just one thing and hope it works for the best. There is a chance that it won’t work, yet in the process, you still spend a lot of time and money on it.
It’s far better to make incremental changes to a whole bunch of different areas in your business. This is because when you improve something by three percent and another three percent, they don’t just add together. They actually multiply hence the principle of compounding.
If you want to find out more about this strategy then you can go to 52ways.com where you can find a calculator that you can use to see the impact of compound interest on the revenue of your business. When you’ve reached our website, scroll down until you see a simple yet really powerful table. Use this to see how you can make extra money from your business.
To teach you how to use the tool, let’s act out a scenario. We’ll assume you’re just starting out in business. You’ve been running it for a couple of years and getting a turnover of around $100k.
Now, go through your business and think of 20 different things you can improve by at least three percent. When you set those values under the income, no. of changes and % increase, you’ll see that your new income is now $180k.
So this means that you’ve just made an extra $80k from your business simply by taking 20 different things and improving them by just 3%.
One Strategy Per Week
Now, if we step things up and say you’re a little more committed. Let’s say you chose 40 things to improve but still keep the increase at 3%. Your new income is now $360k.
While this is a significant increase from your original $100k, we suggest you keep things really simple. Work on one strategy every single week. It may not feel like a lot but you can take 30 minutes to an hour to focus on something to improve. If you do this each week for a year, you’ll find that your income has now increased by $365k.
Simple But Incremental Improvements
Three percent is oftentimes quite a conservative margin. If you really focus on something, you might be able to improve it by 5, 10 or even 15%.
So let’s try to take an average of 5%. Now watch what happens when we change that increase from 3 to 5%. We go from $465k to $1.3 million. All we’ve done is just change a couple of numbers. This is the power around making simple but incremental improvements in a range of different areas in your business.
Let’s drop it back to 3% for a moment. Let’s say your business has been around for 5 or 10 years. Maybe now you’re getting half a million dollars in revenue or maybe a million dollars. If we just start at $500k and we make one change a week for the next 52 weeks. The 3% improvement yields $2.3 million.
If you were doing say a $1 million in revenue, you’ll now be up to $4.7 million.
The Power of Compounding and 52 Ways
You can continue to experiment more with this great little tool as you explore the power of compounding. But what this is really all about is working on one strategy each and every week and making some simple changes. This will all add up to a massive improvement at the end of each year.
So if you want to find out more about this principle and want to learn 52 different things that you can do in business, do check out 52ways.com. We’re currently running events right around the country to help business owners to extract more profits from their business.
Go to 52ways.com to claim your free tickets now. I look forward to seeing you there!