Where the profit is hiding in your boutique \\ 4X Double Down Retail Series
Boutique owners often miss cash hiding in unused subscriptions, excess inventory, and poor pricing. The speaker breaks down markup strategy, explains the rule of thirds sales model, and shows how BOGO deals compare to flat discounts. Bank-balance accounting won't tell you where your money actually is.
Chapters
Okay. And it's preparing to live stream the meeting. Yeah, is there a link? Can you send me that link and just. It's setting up your meeting for YouTube live. Okay. Okay. It's preparing to live stream the meeting. And this is. It's setting up your meeting for YouTube live. So you have Kajabi closed, and you have YouTube closed. Right. Okay, now. Now I'm going back. And I'm closing YouTube. And I'm closing the. Yes, I'm closing YouTube. All I have open is zoom. Okay. All right. Okay. Go for it. Go for it. Okay, I'm gonna hang up the phone. Bye. Okay. Holy smokes. I really hope you guys are on here. Now is the time. So this. I see what I did wrong. You know, it's all trial and error, you guys. Welcome to day two. It is 20 after 10. Good golly miss Molly. What a disaster. You know, here's the thing. There are some things you're good at, and there are some things that you're not. And technology has this black cloud. I know it's sunny outside today, but it's over my house. I know it is. It is over my house. That is for sure. So what I need to do here is I need to somehow double check, make sure everybody. Oh, that's not necessary. That is not necessary. Okay, I want to make sure I'm getting people on here. I don't see anybody yet, but that doesn't mean you're not coming. So I want to share my screen here in just a second. As soon as I can see that there are people. Give me a second. Okay. Are we back? Are we back? I really hope everybody is here. I'm still only seeing one participant. Okay. Okay. I don't see any comments, but Jeff is typing something. Let me see what he. Yeah, perfect. We're good. All right, let's get going here. Let's. Let's share my screen. And I want to start here with this. All right, guys, Big, big stuff today, and I. Man, I apologize. It's 20 after now and after, and you guys are busy, but this stuff is huge. So I want to talk today about dollars and where your money is hiding in your business and something that I always. We coach a lot about this, the retail bootcamp, and just in the hub in general. But it's so interesting when I talk to store owners because, you know, a lot of them are saying, well, I don't have any money to pay myself, or I can't afford to do this, or I would really like to reinvest a new point of sale system or I'd really like to reinvest into something. However, I don't have any cash. And I always tell them, you have cash, you just have to figure out where it's at in your business. Because remember when you got started, you dumped a lot of money into your business or you started somewhere with some cash and you still have it. It's just now dressed up in different things, right? It's all. It looks different than it did. So our goal here at the end of today's session is for you to stop or have a better understanding how to stop living month to month. Because there is money hiding in your business. There is. And it's just up to us to get creative and find it, right? And a lot of it stems back on us being what I would say, lazy or just complacent or you know what, just too dang busy to figure out how to find it. So let's get started. Where is the money hiding? First of all, first of all, guys, I know that there's a lot of you out there. I was this way when I had my store. And for those of you that don't know me, I had a store for many years in a rural town here in Wisconsin and I owned it with a very good friend of mine. And you know, we found ourselves in this position a lot of the time, right? We knew we had money, our balance sheet, our P and L everything. It showed that we had money tied up, but we didn't have anything liquid to use, right? So one of the things that we kind of started to do is really look and see where are we making mistakes. And you know, over the series of years of owning the store and then counseling other store owners and coaching and everything, I have learned that there is a big, big issue out there with business owners. I'm not just going to say retailers, but business owners. Called bank balance accounting. It's not going to cut it. The bba. You can't run a business by bank balance accounting. And a lot of people do it. A lot of people do it. I hope if you guys are commenting, I'm not seeing them, but I'm not about to mess with my screen to try to find it. I will go back and look for your comments and your questions later as soon as we're done and I'll answer those. So take some notes. What we're going to go over today is just some, you know, more realizations and eye opening and how to on getting a little bit more control over your business. Now, so eventually you realize you do have control over the financial part of your business, right? And it starts here with this bank balance accounting. So bank balance accounting does not tell a story. It's like looking at the scorebox at the end of a game that you didn't attend, right? Walking into the gym after, after a game and you look up at the scoreboard and you see, you know, basketball games, 75 to 20, you're like, holy smokes, that guy got their butt kicked. Right? You know, that team is not very good. Well, what do you know about the game? How do you know that the few key players didn't go down early on in the game or that, you know, so and so was sick or whatever it was? I mean, who knows? There could be a thousand things. Heck, maybe you're playing the Division 1 state champions, right? And you're like the Division 5 just newly getting started. Who knows what it is? But what I'm saying is you just look at that scoreboard. You. You can't tell a story from that. You don't know what happened. You don't know the reality, right? And that's what bank balance counting is. You know, if you're, if you're the banker or if you're the retailer that pulls up your online banking or, you know, calls the bank or whatever it is and just is like, do I have money in the bank? Yes, I do. I can still spend money. You know, it doesn't tell you a story. It doesn't tell you what's coming in, how, what's going out. It doesn't tell you if those are legitimate expenses or if there's any theft or fraud there. So bank balance count, it doesn't tell you the story, right? You can't, you can't develop a plan. You cannot plan accordingly for going to market or a recession or how to staff in the current situation that we're in. It's extremely risky and it's nerve wracking. When I say nerve wracking, you guys all know exactly what I mean. You've come to the end of the month where you're like, oh, my gosh, I've got to make payroll. I've got to do all these things. Do I have money? Think I have money? Has that check cleared? Has that one, Is it still out? I think I've got money. I think I can kind of rob Peter to pay Paul here to make this work. Bank balance accounting, that's not. That does not tell the whole story about where your money is. So cash is hiding in your business. But it's up to us to develop a plan and figure out those. Those key areas that they are hiding. Right. So I've narrowed it down to three things and I try not to take much more than an hour of your time today. So I'm not going to fly through all these things. But keep in mind we do go over these a ton in the hub. We dive into this and go through process step by step in retail bootcamp. But today I want to give you some good hard foundational pieces that you can run with. Right? So these are kind of the first one. You're going to be like, oh, wow. Really, Sarah? But stuff. Yes, stuff. Just things. People in business spend money like people in life, right? You want it, you're going to go get it. Somebody else has it, you think you need it, you know, you want to be Instagramable, you want to be awesome, you want to be the coolest cat in town, whatever it is. But man, you guys, we invest a lot of money in stuff. We're investing in stuff that doesn't have a purpose. Right? We're investing in things that we don't necessarily see an ROI from. If your cash is tight, we've got to go back and look at the stuff that we're investing in. And there are some things that really are beneficial to us. Right? Like apps and subscriptions. But at the same time, I guarantee you subscribed or you have an app out there with something or you're paying a fee for something that you're not using. We just looked at a store the other day and I looked at her. Her accounts and I said, what are all these fees and what is this app? You know, $9 a month for this and, you know, 99 cents for this per transaction, all these kind of things. And I said, are you using these? And she actually wasn't even using them. She's. And this is what she said. Oh, my gosh, I forgot. I forgot about that. Well, what happened was she wasn't reconciling her credit card statement. And what happened was month after month after month, these reoccurring $9 fees, you know, 99 cent fees on per transaction and just some subscriptions and whether magazines or whatever that is, like those are long gone. Really not long gone. But I mean, that's not even the thing anymore. It's subscribing to different newsletters or subscribing to different tools. Right. That you're not using. You should, you'd like to make time, you know, you should, but you kind of did it and you forgot about it. So stuff. It's a huge thing. Supplies, man. I can tell you when we would go in the basement of our store. Store, we had a ton of money just sitting down there and supplies, right? You figure, I'm going to go to Sam's, I'm going to buy bulk of this because that way I don't have to go back. However, bulk of that tied up 20 times more in cash than you really needed at the time. So if your cash is tight and you're not even able to pay, you know, you're struggling paying rent or payroll, but you have, you know, two years worth of toilet paper in your basement, that doesn't work out, right? So where is the stuff that. Where. What do we have cash tied up in as far as pretty things and whatever. And all, all those. You guys could. You're probably sitting there looking around your office right now saying, oh, man, I totally get it. I totally get it. The stockpile of hangers in the basement, you know, the racks that are sitting there, the slat walls that you are not using, whatever. I'm not even talking about inventory. I'm talking about stuff, just stuff in this next slide. This is pretty interesting. This is. I pulled this off of opi.net and you know, this is basically on a business with one to four employees. They spend 77 and $92 per month on supplies. That's just supplies. That's over 1100 dollars a year per employee on just supplies. That's a lot when you look at it, per. You know, when you look at it for your overall store, right. Depending on how many employees you have now, I will say, yes, we all need supplies, but there's a lot of cash tied up there. There really is. And it's just some of these things. I want to talk to you today is a little eye opening. It really is. So inventory. Let's talk about inventory. I'm going to mention inventory as far as understanding who you are in where you're at in your business, right? Because just an eye opener. When we invest in inventory, a lot of times we just get. We get pretty excited, right? We see all these pretty things and we see all these things we really want to do. However, however, it's on us to move them, it's on us to use them accordingly. It's on us to stay aggressive with things, right? Making sure they're delivered at the right time. I want to give you a little bit of an analogy here about inventory because when I Talk to store owners, and they tell me they have this cash tied up and they're just not able to make ends meet, right? We start talking about inventory, and I start talking about the missed opportunities they have there. I start to think, in correlation to a gardener, right? Stay with me. I like stories. So my neighbor over here, he has a beautiful garden, right? Come Mother's Day, he's prepping it, he's getting it all organized. He's getting his planters ready, all this kind of stuff. Me over here, I look over there and I think, wow, that's pretty cool. He's got all the really cool stuff. He's going to have an awesome garden come the middle of the summer. He's going to sit back and make his own strawberry jam. He's going to make. Make his own salsa. He's going to make all these own things, and it's going to be wonderful. And everybody's going to want my stuff because it's homemade and it's fantastic, right? This is what I'm thinking. This is what is going through my mind. Same as when I would go to magic, and I see all these pretty things. I'm like, oh, I really want that, and I want that, and I want that. Well, there's a time lapse in between when we want it and then the harvest of it, right? And I guess what I want to say is, enter the hard work. Enter the moving of the pulling of the weeds, right? The hoeing of the garden, the organizing the watering, and then enter life. Life gets busy, and you start getting pulled in all these other directions. And all of a sudden you're like, oh, my gosh, I have not gotten back there to take control of my garden, right? And what's happening? Everything's starting to grow, including the weeds. And the weeds make our store or our garden messy, right? Well, think of this as far as your finances. Think of this as far as your inventory in your store, right? These things need to be working for you, not against you. And there's things within your business that are just muddying up the waters. Completely muddying up the waters, right? So you have all this fun inventory, but then time happens and it ages or it grows, or maybe it's not as attractive as you thought it was before, right? You still have to do something with it, because what happens if you don't? It's a complete waste of money. It's a complete waste of cash. You wasted that opportunity to invest, right? I invested in a small little seed with the intent, with some hard Work and dedication. I was going to reap my rewards and sit on my back porch and have salsa and margaritas with my friends, and it was going to be awesome. Well, then enters life, and all of a sudden that reality, I realize, is very hard to achieve. Thus, with a lot of business owners and a lot of store owners, we end up investing in inventory that we get so excited about, and we invest in it, you know, with an idea in mind. But then life happens, right? Life happens. Things get delivered into our store at the wrong time, right? So all of a sudden, that investment, which we thought was great now is costing us more money, right? We aren't aggressive in our markdown strategies. We're not tracking our inventory. We have a lot of unsold inventory sitting there aging on the racks, just tying up our dollars. And something else we're going to talk about here in a minute is the pricing strategy. This is a huge one. If you're looking for cash in your business, I guarantee you, you have an opportunity to make it in your inventory. However, sometimes we're setting ourselves up in the wrong direction. We're setting ourselves up to fail with the inventory we are investing in. Markup is key. It is so important. It's so important to make sure in our pricing strategy that we are pricing ourselves to win, right? Not necessarily pricing ourselves to keep up with the store down the street. That's not even. She buys these. Everybody wants to talk about it. Can Can Jeans. She's investing in Cancan Jeans, and for some reason, she's selling them for $7 over what, you know, you paid for them. Well, men, she might be selling a few right now, but is she really going to be in business in the long haul? Is she going to be in business? Is she going to be able to pay all the bills that she has to be a legit business? No. So what do we do as the legit business? We try to say, oh, I want to keep up with her, so I'm going to try to price my items more affordable, right? Next thing you know, we're going to price ourselves right out of profit. Unsold inventory, letting things age on the rack. We miss that opportunity to turn that into cash. So sometimes what we do is we get our garden gets too big, we get too many things going that we can't tend to each thing individually. And next thing you know, we've forgotten about something. It's gotten old. Our excitement is lacking for that item, so we're not excited about it. Therefore, our customers aren't excited about it and it's not moving, right? So what? We had an opportunity to turn into cash quickly in the beginning. Now is just aging. How does that happen? Well, we're not tracking our inventory, right? We're not tracking it, we're not running aging reports. These are huge things to be tracking in your inventory. Because honestly, or in your business? Because honestly, inventory is tying up the majority of the cash that you have. This is where your cash is. It's not really hiding, guys. It's hanging on your hangers in your racks. And I, for those of you that have been through any of our trainings, you've been around in the hub for a while, you know that I'll talk about, I'll talk about inventory hanging on your racks that it is. It's like your 20 and $50 bills just hanging there. Just hanging there, right? Taunting you, saying, haha, you can't spend me because I'm just hanging around here aging, right? So then enter your markdown strategy. Not having a true markdown strategy, not understanding the lifestyle cycle of your business. Like when do I need to move it? When is it too ripe on the vine that it's going to rot? Right? That's a big thing. Beginning gardeners fall victim to this all the time. And you know why you can't find that very beautiful ripe tomato to harvest? Because it's been taken over by other stuff. You cannot even see it in the garden anymore. How many times have you walked through your warehouse or you've walked through your store floor and all of a sudden you've open up a rack, push things aside and like, oh my gosh, this is here. I didn't know we still had this. A customer was just asking for this the other day, right? We're not taking care of our inventory and presenting it in a manner and introducing it in a manner that's exciting to our staff to move it and our customers, right? And when we have those things that are aging, we have those things that are about to peak and go over that threshold of their life cycle. We need to get aggressive and move it, move it out, right? Pluck it off the vine. Whatever you want to say. But the delivery dates is a really important one. We have cash tied up in the wrong delivery dates. We really do, right? Because if we have committed to something and we've pushed it out and then all of a sudden it doesn't come, we have cash we've allotted for that delivery, right? If we're not tracking those deliveries to making sure they're coming in we don't have that money to go back and invest elsewhere. And that's missing out on an opportunity to invest here to make more money. Right? So inventory is a huge, huge things, delivery dates, knowing what to expect, when to expect it, so you're not blindsided by anything where all of a sudden you have to take money out of your savings or take money out of your payroll account to pay for inventory that was surprising, surprisingly delivered to your front door. All right, let's talk margins. Margins I'm going to get, I'm going to take, show you a chart here in just a little bit. But margins is huge, guys. Your gross profit margin, basically it's just your profit divided by your revenue. Right? But the difference that in stores that are really cash strong and the difference in stores that are cash weak in their margins, it's important to be looking for opportunities at all times. Somebody asked me the other day, you know, Sarah, when do I need to start looking for margin builders? When do I need to start looking for doorbuster deals? Or when do I need to start looking for items to entice my customers to come in? And I sat there for a second and I said, ask yourself that question again, like say it out loud. I said, as a retailer, you want to look for those things all the time. Just because society says Black Friday shopping or after Christmas deals or whatever it is, that doesn't mean that you shouldn't be looking for margin builders in your store all year long. 100%. So invest in inventory, that makes you money. We have lots of resources in the boutique hub of opportunities for closeouts or off price items. We work with the off price show in Las Vegas very, very directly, you know, and we work with vendors that are great to communicate back on items that are being closed out or, you know, this is a true seller for us. This is where people are really making a good margin. Right. Because we're guaranteeing the sale. This happens. We have what vendors will say, man, it's blown out of the, out of the stores, flying off the racks, it's whatever. Well, those things, you know what, I'm going to talk about a rule of thirds here in a little bit. But those true sellers, you don't have to worry about that as much. Right. You know, the customer is demanding that product, right? Investing in that, not tying up your dollars so much in inventory that you're hoping you're going to sell. Right. Making sure you're taking care of your margins first and foremost when you're shopping, when you're Investing in your business, making sure you're investing in inventory, that you are confident you're going to move the risk. Especially right now, I want to talk a little bit about the whole, you know, COVID lockdowns. Where retail is going. We don't know. It's very volatile, more volatile than it ever has been. And let's be honest, retail is constantly changing. If you like a job and like a business that is, you know, point by point, going to be on track every day, retail is probably not for you because it is ebb and flows, ups and downs. Somebody's always throwing something at you. Well, right now it's even harder. So as you are investing in your inventory, I really urge you to check out these margins. Where can you be making the most money, right? Where can you be investing that $10, $20 that you have to invest? And rest assured, feel confident that you're going to turn that back into cash? I know it sounds easier saying, well, I do that all the time, but do we? Do we really? Because what happens, and I know I did it when I had the store is I would get to market and I would be like, oh, that looks beautiful. I want that. And I didn't think of all the things that needed to happen to go through, to sell it, right? Just like my neighbor's garden, I get attracted by looking over there and be like, oh, my gosh, I want that. Well, do I want to skip out on my 4th of July weekend at the lake to stay home and water it? Do I want to weed it every night and weekend? Do I want to fertilize it? Do I want to identify what those little bugs are that are eating my plant leaves? No, what I'm saying is there's hard work that goes into these kind of things. There's reason they're going to succeed, and there's reasons they're not right. Investing in too much inventory and having too many options for your customer creates confusion also, and you're reducing down on your margins then honestly, because you have too much product. And then that happens too, onto the next thing, markdowns, right? And we get. We get lazy with the markdowns. So as I talk to you a little bit about this, one of my other challenges would be for you to get out of your store, get out of your warehouse, get off your website and look around, shop other people's websites, go to the mall, go to other boutiques and look and see what other customers are seeing, right? Because that is helping that customer identify what the new normal Is Right. And you want to make sure that you are capitalizing on that. Being outside of the box. Right. Being outside of the know, I should say, and not understanding what is happening at your big box stores, what is happening at your discount stores, what is happening at your malls, what is happening at your other boutiques, what is happening on other websites. Not paying any attention to that is gonna have a direct reflect on what your customers think about you. Right. So it helps you make better decisions. That's kind of a side note. Just because I say that. Yes. Because I was shopping the other day, I went out to do what I called R D. Right. Don't have my store anymore. But I think it's really important that I get out and about and kind of see what's out there. You know, as I'm coaching and mentoring other boutique owners. And I was walking through the mall and I'd walk into stores and it looked like they were going out of business. Their, their inventory was so lean. However, they, when I talked to them about it and I talked to an awful lot of different store owners, they were really on the lean machine of their inventory. And then when I go into some boutiques, they're super overcrowded. Right. Well, instantly my mind is working. And my daughters even said something about it like, oh my gosh, this person has so much inventory, how are they going to move it? Right. And they tended to start moving through racks and getting a little confused. They couldn't find things, they couldn't see things. Next thing you know, a confused mind doesn't buy. So keeping that in mind, Right? Keeping that in mind when you're talking about investing in your inventory. But next, let's talk about markdowns in your margins. It's so important to not get lazy, right. So we're trying to invest in inventory that we're confident in. We're trying to invest in inventory that we see good margins in that good markup, that we can mark them up but maintain that margin. That's the difference. Right. That markup is great. Anything you can do on paper. But it's the margins at the end, once you've sold it, that is telling you if you're winning or losing. Right. But one thing I really want you to consider when you're looking at where your cash is, is you're missing out on cash. If you're just doing blanket sales, right. Consider BOGO versus a simple discount sale. Say 100 people buy one item each at 25% off. Right? 25% off of $50. That's 3750. Sorry. That slide got pushed together and then 100 people shot the BOGO sale 50% off the $50 items. If that's, if you run that bogo sale, that brings in $7,500 versus the 3,750. Look at that again. So if you run a total 25% off, right, 25% off, the majority of your customers are going to buy one item. Now, if you run that as a bogo sale, those customers are buying two items, but it's the same discount, still 25% off, but you've just disguised it, right, with some 50% off thing. That's $7,500. That's twice the money because you're selling twice the products, right? So that's a win. You're making more money. There's some cash. You're freeing up your inventory, turning it into cash, which is helping you pay your bills. These little trip tips and tricks are going to really help you if you start concentrating on them. So you're not living month by month, day by day, just hoping that that bank balance accounting is going to show you some, you know, black, black numbers instead of red. Right? All right, let's take a look at this. Let's take a look at this. I hope you guys can all see this. Okay, so this is a pricing model. This is about six pre packs. Six pre packs. So say your, your pre packed items over here on the upper left is they're $10, right? $10 cost per item. You're going to retail those in the first line. You're going to retail those at $20. So your profit there is only $10. That's at 50% profit margin. Now, the rule of thirds basically is saying over your overall inventory in retail, you, you can do a quick assessment of a rule of thirds, which would mean out of those six, you're going to sell two at full price, two at 20% off, two at 50%. So take a look there and you are going to realize that if you sell those two at full price, it's $42 at 30% or 20% off is you're bringing in $32 to a 50% off. You're bringing in $20. So your total income on that six pack is $92. $92 is. If you go with the rule of thirds, the total income is $92. But the cost of that was 60. Right, because we go back to the cost. It was $10 an item and you invested in six pieces. So what you're actually going to be putting away is 32 bucks on that investment. That's with the rule of thirds. Now, some of you guys might say, oh my gosh, I would never go by the rule of thirds. You're going to have items that you don't. You're going to have those tried and true sellers. But this is why I say it's really important to invest wisely and pay attention to your markup, right? It's very important to pay attention to your markup strategy. Pricing yourself to profit. Don't price yourself to match and compete with that girl down the street that we were just talking about that's taking a $7 upsell on her Cancan Jeans. Nope, that's not the business we want to be in, Right? Because we want to run a business, not a hobby. So go ahead and look through this. And this is, this will be on replay so you can come back and take a look at it. But then you look at that same $10 cost item that you're going to retail at $30, right? You're going to get a $20 profit on that. You scroll that across, way across, and you look at your two at full price, two at 22 at 50. Your total income on that $10, which would be that $60 investment. But you mark that up to $30. Your total income on that's 138 minus the $60 cost of the product. Now, you've made a $78 net on that. You're putting $78 in the bank on that. So do you see just the difference where that cash is hiding? That's an except. That's a lot, right? That's a lot. And it's basically you're going off of whether you're going to charge $20 or $30 for that item. Now, keep in mind, you're a boutique, you're a specialty store. You offer service, you offer, you offer education and entertainment, and you're a shoulder to cry on. You're all these things to your store owners, right? And they trust you with that. There's value there. So if you are the store owner that's doing all of that and packaging your products up in beautiful papers and bows and ribbons and tissues and all that kind of stuff. And you're volunteering and you're donating to the little boys club and you are doing all these awesome things, right? Do you think you owe it to yourself to get $78 out of that six pack or 32, right? So on that very first line, I split this up so you could kind of see it a little better. But if you look down to that lower box, how many units do I need to sell to reach X amount of goals, right? Of that $10, the very first line up there, that $10 item that you're gonna sell for 20 bucks to make $2,500, you have to sell 250 of those $20 tops. This is. We're not doing the rule of thirds on this. We're just doing this at full price right now. If you want to make a 10,000. If you want to make $10,000, you're gonna have to sell a thousand of Those tops at 20 bucks. You can do this all the way down. I want to go down to. Just for the value of time here, I want to go down to the very last line. So say you. The last two lines say you have a $30 cost item, right? $30 cost sweater. Let's say now we're just going to retail that at 60 bucks because some people say, hey, I just want to be the affordable price in town. I want to be the affordable store, right? So we're going to profit our $30 on that. Our rule of thirds say we'll sell two at full price. So that's $120. We're going to sell two at 20% off for 96 to 50% off for $60. Our total income there is $276. However, it cost us one hundred and eighty to invest in that, so we got to take that away. Now on that $30 item, we're gonna be able to put $96 in the bank again. We're doing all this stuff. We're providing a service. We're keeping our lights on. We're actually paying taxes. We're doing. We have a website, we have an amazing social media, you know, contribution to society, all this kind of stuff. We're providing a service. We're legit business, right? We want to be. We want to be all these kind of things. So we have bills to pay. So now we look and say, all right, we are. We're going to invest in this $30 top. And I believe since we are an amazing business that does all these awesome things and we provide education and service and collaboration and, you know, we're trusted. We have a return policy. We do free shipping, we do amazing things, right? We are going to be able to charge $90 for that top because investing in a good quality piece, and I feel it's worth $90, and my staff is qualified to sell it at $90. So I'm going to make a $60 profit on that, right? Do my rule of thirds scroll all the way over to the from six pack total income line $414. We still have the same $180 investment, but now we're putting $234 in the bank. You can see right there. You can see the difference that those that markup is making, right? Where's your cash hiding if you're not making enough money, if you're not able to pay the bills because the bills aren't going to be cheaper just because you charge less for your products. They aren't. The bills are going to be. They're fixed, right? We're going to talk about that here in a minute. But this is extremely important. Extremely important. So like I said, this will be on replay. So you can kind of go back and take a look at that later. So stop living month to month in your business. Please stop living month to month in your business. There's three other things for a break even point that I want you to consider. I really want you to pay attention to your break even point is your fixed cost divided by your average price point minus your variable costs. So what are your fixed costs? We were just talking about some of these things. These fixed costs, they are going to be what they are whether you, whether you are charging $90 for that sweater or $60 for that sweater deland or doesn't care, right? And you're not. Your salaries aren't going to be much different in your property tax. They don't carry there. Those are fixed costs. They're not negotiable, right? So then your average price point, you know that you can do the math and figure out what your average price point is in your store. Your variable costs, these are obviously fixed means it's fixed. They're like cemented in variable cost means they go up and down. They, they are dependent upon your sales, things like that, their wages, utilities, commissions. Those are just a couple examples. But I guess my point here guys is in order to identify where your cash is and to stop living month by month in your business, it's super important for you to know what does it even cost you to turn the lights on? What does it even cost you to fire up your and have your website operational? Not negotiable. It's not going to go away, right? So let's pay attention to our pricing. Let's pay attention to our markdowns. Let's pay attention to all that inventory that we're bringing in. Let's pay attention to the. Oh, I think, you know, I think those, I want those new chairs or I think I, you know, instead of doing a regular handle bag, I want the bigger Vogue bag with the fancy tissue and that we're going to wrap ribbon around it. We're going to do all these things, which is fine. However, you can't do it with that $7 add on to a pair of $20 cancan jeans. There's just not, there's no way to possibly make that happen. So 2020 has thrown us some curves. It has. I mean, you guys, I feel your pain. I listen and talk to so many of you and I know what you're going through. You know, I had the store through the 2008, 2009 recession and I had, you know, all sorts of different issues happening in our community with, you know, rerouting of traffic and things like that. Nothing, nothing like what is happening right now and what potentially could be happening down the road. However, this is your business and you want to survive, right? And you want to be better tomorrow than you were today. You've got to get to know your numbers. And you'll hear me say all the time in retail bootcamp, as we go through this module by module and help you really dive into that, you'll hear me say, know your numbers. And this is how you do it, right? We're gonna dive back in, we're gonna identify where is the hole in our bucket, where are we spending too much or where are we not gathering enough, Right. So we can make a plan. We need to have a good understanding of our financials or else we're just winging it. That bank balance accounting, that's not a business owner's move. It's not. That's a 16 year old kid with their first checking account move. We're bigger than that. So retail bootcamp, I talked about that a little bit throughout this. But, you know, I'd really like to show you how that we can make this work together. I would really. This is. Everybody kind of labels me the numbers person. I'm not really the numbers person as much as I am. Like, I am passionate about it because I saw what it did in my business when we took a hold and really turned things around. Right. I didn't make any of this stuff up a lot. What I'm learning, what I'm teaching you is what I've learned and implemented through over the years, right? Stuff that's not negotiable. We dive into this in retail Bootcamp and we bring in guest experts that can help you along the way. So as you guys know, Retail Bootcamp is our most in depth training. I hope it's okay that I'm chatting with you guys about this right now because I feel like if you are sitting here watching, you are thinking, ok, I get this, I need to do a better job in this. Where do I really start? How are other people doing this? What are some tools and strategies that I can implement? And you will hear me say this all the time. It is not just on you. Because at the end of the day, we all only have 24 hours, right? We are trying to do 60 hours worth of stuff and still sleep, eat and maybe exercise, right? And hopefully spend some time doing something we love. But Retail Bootcamp is a very in depth training where we give you specifics and we map out a game plan for you and we give you tasks and we ask you to identify things throughout your business and we streamline those, right? And then we implement services that can help you. Here you are today. This is where you want to be and this is how we get there through inventory management and financial planning. Those are huge. And those aren't things that you can just open up your bank account, look and say, oh yeah, I totally got this, right? Because the more money you have in there, the more excited you are to go spend it. Well, are we spending it on the right things? Is it going to invest? Are we investing in the right things that are going to make us a better roi, right? Quicker turn on our inventory for profit? Are we going to allow that cash? We're going to turn that awesome money that we love it kind of money. We're going to go invest it into something that's just going to sit there and age, right? Because we say inventory is not like fine wine, it does not get better with age. And nor any of those supplies that you have laying around, right? Those supplies we hope are working for you. But when we want to go through your P and L and your balance sheet line by line and we want to say, okay, hold up, this doesn't make sense. Last year we've invested here. This, this year we're way up, right? We're not on track, but yet our sales are down. Or this year our sales might be up and we're super excited about it. But then we're going to deep dive in and look at your inventory. Have you quadrupled on your inventory but yet your sales are just up 5%. That's a hole in the bucket. We go into this a ton in Retail Bootcamp and through our live sale or live trainings and also through the modules of the worksheets and the guest experts. So when I say it's in depth, it is in depth, right? And it's launching, it's open now. So take a look at some of these amazing results from awesome past Hub members or past Retail Boot Campers. And it's so awesome when Ashley and I get messages from people that are saying, oh my gosh, Retail Bootcamp completely changed my business. And we're not just saying that. You know, we. Here's some examples right here. Being able to pay themselves, being able to pay their employees, being able to take their employees on a trip, being able to hold their head high when they do their taxes, when they sit down from the table with their, their partner, their husband, their spouse, whatever, and say, look, look at the business that I have built. Right? We start at the beginning and we go all the way through some of the very advanced techniques. It is a program for no matter where you are in your business, who you are in your business, and what's so fun is you have lifetime access to Retail Boot Camp. So let's look at a few of the things that you'll learn. Right? We talk about CEO mindset planning and foundations branding strategies, knowing your customer. I mentioned inventory management, financial profitability management, merchandising, E commerce, live selling, email marketing, digital funnels, sales funnels. We're going to talk more about that in the webinar this week yet. But we really deep dive into these kind of things and a tried and true implemented traffic strategy. And we also bring in some really awesome guest experts such as our Jeff right here from Retail Bootcamp from the boutique hub that is our marketing unicorn and he is fantastic. So it is 14 weeks of group and individual coaching. We have modules that you are released that we release to you as well as our workbooks. We go live, Ashley and I go live in the camp once a week and then we bring guest experts in to come live once a week. We also have videos and checklists and downloads, all these kind of things for you. The also really cool part about it is you have lifetime access. Yeah, lifetime access. So once you get on, you have access to all the new upgrades, all the new things that we're adding every semester. We call it semester because it launches twice a year. But yeah, the people that started four semesters ago, they're going to get to take it again and they're getting to get to learn from the new experts that we bring in because retail is different in 2020 than it was in 18. We all know that, right? So once you invest in it, once you have it foreign. Oh, I should say yes. There are also, there are also some VIP opportunities if you want one on one coaching with Ashley and I and you get a coaching call with her, a coaching call with myself individually and then you also get a group VIP just in a small group of people with Ashley and I also. So that's really fun. Yeah, we have a good time with that one. So what is the investment? Man, it is, it's well valued over $10,000 which when we start itemizing all these things out, it's just, it's, it's wild what you get for this 1997. And we do have a payment plan for that also. So that's really cool. Payment plan available where we can break that up into three installments if you're interested. So I'm going to drop the link in. I believe it's dropped in the comments already so you should have that. But also you can email Ashley or myself@sarah saratheboutiquehub.com or ashley@the boutiquehub.com as well if you have any questions. But yeah, we also are giving away some fun things with this if you are going to enroll. If you enroll in Retail Boot Camp, you get the free boutique content calendar and the free boutique boss planner available. Yay. That's awesome. Those are bonuses. Really excited about that. But there is the link. And please, because I had some technical difficulties at the beginning, I'm not able to. I'm going to stop sharing my screen here in a second and hope I find all your tests are your comments. I know Jeff and Ashley are in the comments answering questions right now too. But because of that black cloud of technology that was hanging over my head at the beginning, I'm a little leery about that. So I.
