By Kyle Dickinson, Entrepreneur Fund Business Developer
As entrepreneurs, you’re not just business owners; you are visionaries, innovators, and creators. You’re driven by passion and the desire to offer something valuable to your communities. Yet, despite your enthusiasm and drive, one hurdle may often slow you down – the sales process.
Selling can sometimes feel like a minefield. The final ask, whether it’s at the counter or in a conference room, can create a cloud of discomfort. Fear not. It’s time to refine your sales approach, make the uncomfortable comfortable, and turn stumbling blocks into stepping stones.
Much of the discomfort associated with sales springs from its perceived ambiguity. But what if we could turn the foggy notion of “sell as much as you can” into a more tangible target such as “sell 10 items this week?” Clear, specific sales targets can transform the sales process by making it more manageable and less daunting.
So, how do you set these clear sales goals? Let me introduce you to an incredibly powerful tool that should be in every entrepreneur’s arsenal: cash flow projections.
Cash Flow Projections: Your Financial Compass
Cash flow projections serve as a business’s financial compass. These tools can vary in sophistication, from Quickbook’s Cash Flow Planner to a straightforward Excel spreadsheet. Their purpose, however, remains constant – to forecast your business’s financial future based on your past and current performance.
From Foggy to Tangible:
The Coffee Shop Example
Imagine you run a coffee shop selling an average of 100 cups of coffee per day. You dream of employing your first barista, which means you’ll need to sell about 125 cups a day. But how do you reach that target?
This is where your Entrepreneur Fund business advisor and cash flow projections come in. First, they can help identify factors that contribute to increased foot traffic. This could mean adjusting store hours, promoting special offers, or partnering with local businesses.
Next, your EFund advisor could assess your coffee menu. Maybe certain products are more popular or profitable? If so, focusing on the promotion of these items could enhance sales. Or perhaps, introducing new, enticing flavors or limited-time offers might pull in more customers.
Your EFund advisor can also assess if there’s a scope for cost-cutting without compromising quality. Maybe you can source better-priced coffee beans or supplies? Reducing costs indirectly improves your cash flow, making it easier to reach your sales goals.
Do It Yourself: Cash Flow Projection Resources
While the task may seem daunting at first, there are plenty of resources out there to help you create your own cash flow projections. Here are a few options to get you started:
- QuickBooks Cash Flow Planner: This is an excellent tool if you are already using QuickBooks for your business’s accounting. The Planner automatically syncs with your QuickBooks data to create detailed cash flow forecasts.
- Microsoft Excel Templates: Microsoft offers a variety of free Excel templates for creating cash flow projections. These templates are easy to use and can be customized to fit your business’s specific needs.
- Online Courses: Websites like Coursera, Udemy, and Khan Academy offer comprehensive courses on financial planning and analysis, including cash flow projection.
Remember, the key to accurate cash flow projections lies in understanding your business’s past and current financial performance. This includes aspects such as revenue trends, cost patterns, and the impact of seasonality on your sales.
Aiding in Purpose and Accountability
Your EFund advisor can be instrumental in translating cash flow projections into actionable sales goals. These goals, built on the foundation of your cash flow projections, demystify the sales process, imbuing it with a sense of purpose and direction.
In our example, we can calculate how much additional foot traffic we need to reach our new sales goal. We can then implement marketing strategies and goals to drive this foot traffic.
But it’s not just about setting goals; it’s also about maintaining the momentum to achieve them. Here, your EFund advisor can serve as an accountability partner, keeping you on track and offering guidance and support when challenges arise. Regular check-ins and progress reviews can help monitor the alignment of sales outcomes with your set goals, allowing timely course correction if required.
Achieving Sales Success Through Cash Flow Projections
In conclusion, setting tangible sales goals doesn’t have to be a daunting task. By leveraging cash flow projections, we can transform an often ambiguous process into a clear, measurable strategy. Whether you’re aiming to increase daily coffee sales or expand your product line, cash flow projections are your guiding compass. They take the guesswork out of the equation and lay a clear path towards your desired business goals.
Remember, cash flow projections aren’t a one-time event but rather a dynamic tool that should be revisited and revised as your business evolves. As you navigate your entrepreneurial journey, remember that your Entrepreneur Fund advisor is there to provide invaluable guidance, support, and accountability. So, embrace the art and science of cash flow projections and prepare to elevate your sales process to new heights. Happy goal setting!
Ready to leverage your cash flow projections? Reach out to your EFund advisor or contact us to get connected.
Kyle Dickinson has been a business developer at the Entrepreneur Fund in the Twin Ports area since 2021. He holds a bachelor’s degree in finance and a Master of Business Administration. Kyle has over a decade of experience in investment management running complex price forecasting and modeling.