Tag: Jacob Curtis

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Finding Your Financial Sweet Spot

Growing a business is hard but it shouldn’t be impossible. Read on to find your company’s sweet spot and accomplish your financial goals.

The Sweet Spot

According to “The Pumpkin Plan” by Mike Michalowizc, there is something called the sweet spot that helps you grow your business. Just like growing a large pumpkin requires the right seed, growing a company requires the right strategy. That’s where the sweet spot comes in.

There are three elements of the sweet spot including top customers, unique offering, and systemization.

Customers

As you know, top customers aren’t the people who buy the most. Top customers are the people you want to work the most with. Make it a goal to find top customers. Then work feels like helping a friend.

Unique Offering

Your unique offering sets you apart from competitors. Michalowizc refers to it as your AOI or Area of Innovation. The Area of Innovation consist of three things: quality, price, and convenience. Try to focus on one. If you focus on two, it can cause you to fail.

Note, focusing on price is a slippery slope. It’s a long, uphill battle and can be very difficult. So ask yourself, do you want to be BMW (quality), Walmart (price), or Amazon (convenience)?

Systemization

Last but not least, systemize. This means optimizing your employees, technology, and processes to be as efficient as they can be.

Inspiration for this post came from “Finding Your Sweet Spot” by Jacob Curtis, CPA published in the June 2022 issue of American Quilt Retailer.

If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you. And don’t forget, you can always purchase single issues if you prefer that instead.

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How Weather Affects Sales

weather

Spring has sprung and warm weather has come with it. Have you ever thought about how the weather affects your sales? Keep reading for insight on how the biggest force of nature affects your business.

Bad Weather Means Bad Business

Did you know that customers are three times more likely to complain on a rainy day? Additionally, the weather only has a 15% chance of being the same as the year prior – so it’s difficult to plan precisely.

So what does this mean? When it comes to staffing employees, think of where and when you need help. Foot traffic increases in brick-and-mortar stores during warm weather, so that’s where your staff should be. On the flip side, colder weather means more online sales. This means shipping costs increase and you’ll need employees to fulfill those orders.

Unfortunately, sales will never even out over time, just like the temperature changes year round. That’s why it’s important to have strategies in accordance with the shopping patterns of customers, while also remaining flexible enough to adjust to the weather.

Inspiration for this post came from “Weathering the Weather” published by Jacob Curtis, CPA in the February 2022 issue of American Quilt Retailer.

Next AQR Academy

Before we go, we want to remind you of the next AQR Academy workshop on April 12, 2022 from 9:00 – 10:30 a.m. CST. The theme is “Jazz Up Your Fabric Displays” where we’ll cover how to get more product noticed and entice customers to spend more time shopping! Register now and you will also receive a copy of Visual Merchandising 101: Making the Most of Your Store to download instantly.

If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you. And don’t forget, you can always purchase single issues if you prefer that instead.

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Profit First Cash Management

profit first cash management

At the end of the day, profit is how we’re able to run a business. If at the end of the year, year after year, you’re unhappy with the profit you’re seeing, something has to change.

Enter profit first cash management. What does this mean? Essentially, Profit = Sales — Expenses. Simple right? What if we switched this equation around to account for human behavior. In other words, what if it looked like this:

Sales — Profit = Expenses.

Game changing, right?

What is Profit First?

What do we mean by profit first? Profit first teaches you to take the profit first then use the remainder to run the business. Essentially what we’re putting into practice the time-tested adage “pay yourself first.” The first step to get started is to complete the profit assessment, which you can find here.

If you’re beating yourself up for the numbers you see after completing the assessment, you’re not alone. Thankfully, this is just the starting point.

Open Your Accounts

Now that you know where your finances stand, it’s time to set up your bank accounts. The five foundational accounts include:

  • Income
  • Profit
  • Owner’s compensation
  • Tax
  • Operating expenses

And it’s recommended quilt shops should open an inventory purchases account also.

Another way to do this is to open a profit account, then transfer 1% of each sale into that account. If your business runs on $1000 / month, it can survive on $990 / month. Although this feels like nothing, you’ve started a habit that will grow month over month and change your business habits forever.

Inspiration for this post came from “Overcome Financial Stress” by Jacob Curtis published in the October 2021 issue of American Quilt Retailer.

If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you. And don’t forget, you can always purchase single issues if you prefer that instead.

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Know Your Break-Even Point

break-even point

Knowing your break-even point helps you to plan for the long-term. Plus, the more data you have, the better you can run your business. Check out the below to find out just how much it costs for you to keep your doors open.

Determining your break-even point

A break-even point tells how many sales you need to cover expenses (or where it breaks even for a given period). By knowing your break-even point, you can determine how viable your quilt shop is, and if it’s getting weaker or stronger.

The equation for calculating your break-even point (or really when your revenue equals $0 profit) is:

  • Revenue = Cost of inventory (goods) sold + Other expenses + Profit
  • For the equation:
    • Revenue = Sale price per unit x Number of units sold.
    • Cost of inventory (goods) sold = Cost of inventory per unit x Number of units sold (keywords are inventory and sold. Not what’s sitting on your shelves).
    • Other expenses = Sum of all non-variable expenses (or rent, utilities, payroll, insurance, taxes, etc.)

For break-even purposes, profit is $0. If you want a margin of safety, simply chose the number you want as a net and plug that into the equation.

Determining daily business costs

Once you figure out what your break-even point is, you can determine how much it costs to operate per day.

Most quilt shops separate this into two categories: fixed expenses per day and variable expenses per day. Some of these expenses include payroll, rent, utilities, and more. Knowing all of these equations will help you make smarter buying and selling decisions.

Inspiration for this post came from “Know Your Break-Even Point” by Jacob Curtis published in the June 2021 issue of American Quilt Retailer.

If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you. And don’t forget, you can always purchase single issues if you prefer that instead.

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Preparing for Tax Season

Tax Season

Tax season is upon us. If you’ve already completed your taxes, great work. If you haven’t, check out some of these tips to tackle your taxes like a pro.

Tax Deductions on Travel Expenses

Many business owners aren’t aware they can deduct taxes from a business trip combined with a vacation. Outlined below are a few examples of deductible travel expenses.

  • New business: Looking for a new location? Travel to and from the location on days meetings happen are deductible.
  • Conferences: This is most often the work and play trip combined into one. Travel to and from the conference is deductible, but days that business doesn’t take place are not deductible.
  • Board meetings: For board meetings to be deducted, there must be a reason why the primary location is not suitable for the event. For example, to get more board members to attend the meeting would qualify.
  • Spouse/Children: Travel for children is typically non-deductible, unless there’s a reason. If your child is your videographer and attends the trip to work with you, then that would qualify as a deductible expense.

Home Office

If you have a home office, the home office deduction won’t cost any more than what you already pay. The home office turns a percentage of your personal home expenses into tax-deductible expenses. Speak with your tax person to calculate the amount of savings this deduction can influence the amount you may owe.

Follow these strategies to get your personal and business income taxes to the lowest legal amount. Stay tuned next week for more tax tips.

Inspiration for this post came from “Tackle Taxes Like a Pro” by Jacob Curtis, CPA, published in the February 2021 issue of American Quilt Retailer.

If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you.