C&T Q&A – How do you Track your Income and Expenditure? (+ Bonus FREE Spreadsheet Download)

Free Download - Income Expenditure CreateAndThrive

This week’s question is from Liya:

I wanted to ask you if you could e-mail me a copy of the spreadsheet that you keep for your income and expenditure, as I’m new to this, will be eternally grateful if you think it’s not too much to ask!!

Many thanks in advance for your help!!

Kind regards,
Liya

I’ve gotten a few requests like this, so I thought it might be a good idea to talk money here today. Specifically – how do you stay on top of your business income and expenditure so you don’t have a massive freak-out come tax time?

Okay, first of all? You should NOT be leaving this sort of stuff till tax time. If you’re serious about running a business, you NEED to know where your money is coming from – and where it’s going.

I know it’s a tedious task, and something we’d all rather avoid (and I’ll be completely honest here – I was SUPER-happy the day I handed this task off to Nick to take care of for me – he’s kept the books for at least 2 years now). However, I kept on top of it myself before that, and it was extremely worthwhile.

Money is Motivating

I don’t know about you… but I find keeping track of my biz money very, very motivating! I LOVE looking at my income at the end of each month, knowing that I made that money by sheer force of will – because every dollar I earn in my business I have WORKED for. Not like the old days where I got my salary in the bank every fortnight no matter how hard (or not) I worked at my job.

The more I earn, the brighter that happy glow of achievement burns. For me, that’s a super-motivating feeling!

I also need to know how much of that money we have actually kept – comparing the gross income each month to expenditure is the only way to know just how much money I have actually made.

Money In – Money Out = Money Kept

If you’re not tracking this on a regular basis, how on earth will you know how successful (or not) your business is?

Are you Running your Business into the Ground?

When we start off in this whole crazy caper, most of us are a little bit addicted to buying supplies. Come on, you’re among friends, you can admit it ūüėČ

I dread to think how much money I spent at Spotlight in the bead section before I learned that there were better places to buy stuff from! If I go back and look at my income/expenditure for that very first year – when Epheriell was a hobby business that I ran in the down-time from my full-time job, I think I spent around $500 more than I earnt from it. At the time, I was pretty damn happy about that!

My only aim at this point was that the sales I made supported my ‘habit’. (Read, craft-supply-buying addiction…)

They did, and I was pleased… but I soon wanted MORE. And so the business turned from a hobby business into a ‘real’ business.

If I wasn’t tracking all of my expenses from the start, I wouldn’t know where I stood. I wouldn’t have had the confidence to grow my business, because I wouldn’t have had any idea how well I was doing.

Knowing where your money is going helps you to modify your business practices.

Maybe you need to cut back on buying supplies until you make a few more sales. Or maybe you’ve earnt more than you think, and you can re-invest that money into your business in the form of buying tools/materials or advertising!

It will also help you to avoid the pitfall of running your business into the ground by vastly over-estimating your income vs. your expenditure. There’s no way to really know where you stand unless you can see it in black and white.

An Example Spreadsheet (Free Download)

There are all sorts of fancy money-tracking programmes out there. To be frank – I’ve never used one because I don’t want to devote the time to learning, and the super-simple ones are always US based so don’t work with my Australian bank accounts (you know, those ‘automatically add paypal/bank income/expenses for you’ type programmes).

To this day, we just use a simple, straightforward spreadsheet to keep track of our business finances.

I thought I’d help you all out by creating a downloadable spreadsheet for you!

It includes an example page where I show you just how we use it, as well as all of the months of 2013, ready and waiting for you to just pop your numbers right in there.

Example Spreadsheet for Handmade Business from CreateAndThrive.com

Click here to download the spreadsheet

As you can see, it doesn’t have to be complicated!

The hard part is keeping up with it regularly.

Don’t leave filling this in until the end of each month, or it will be an onerous task that you dread. Break it up into tiny pieces – make it a habit!

My advice is to fill it in at the end of each day – or, failing that – weekly at the absolute least.

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Homework

  1.  Download the spreadsheet above
  2. Spend time today getting this month up to speed. As I publish this it’s the 8th of February – so you’ve only got 8 days to catch up on for this month. Start there!
  3. Share your thoughts in the comments – do you use a similar system? Something different? Do you have any questions about this spreadsheet, or tracking finances in general?

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Do you have a question for Jess? Just click the ‚ÄėFeedback‚Äô tab on the left of screen and send it in!

C&T Q&A – How do you Break Up your Day so Everything Gets Done?

floral clock wooden

{image by say hello shop}

This week’s question comes from¬†Elisa Mardegan of¬†Dazzling Dezignz.

Right now I’m feeling a bit overwhelmed. I have a family so I only have about 6 hours a day that I can be really productive. With all that has to be done I don’t know where to start to get it all finished and I’m waiting for some new tools to arrive so I can learn a new style of jewelry. How do you break up your day into everything that needs to be done so it will actually get done?

Great question, Elisa, and a very thorny one, too!

Can I be honest? I STILL haven’t figured out the best way to do this! I think it’s an ongoing, organic process. However, I will share a few strategies that work for me (when I remember to use them…).

The 45/15 Rule

I won’t go into detail about this here, because I wrote a whole post on it. The gist is that you work in 1-hour chunks – 45 minutes of absolute focussed work followed by 15 minutes of play. This is really useful when you have a lot of work to get done, and you have trouble focussing for a long time (which seems to be all of us in this world of social media distraction).

I use this when I’ve got a deadline or just want to be really productive. I can focus on my work for 45 minutes with the knowledge that I’ll get to check FB, twitter, and email in the 15. The trick is to use a timer that dings at you so you don’t lose track of time. More on that in this post.

Chunking

Chunking is what I call the practice of doing one particular task in a big chunk of time. I tend to be a ‘day chunker’ – that is, I break up my week into days that focus on different things. One day is a making day, another day is an admin day, another day might be a planning day… This helps me focus on one thing, rather than flitting too much and splitting my concentration.

You can also apply this in smaller bursts – such as devoting 2 hours to making, 2 hours to admin and 2 hours to planning in one day (if you only have 6 hours to work). Another day you might change the ratio depending on what work is pressing.

Prioritising with a Week-to-a-Page-Diary

It is SO easy to get distracted and just attend to things as they come up – crisis-management, if you will. This is the perfect way to get yourself stressed, flustered, and left with that nagging feeling of ‘what did I actually¬†achieve¬†today??’ Not a fun feeling.

Prioritising tasks or types of activity can help to overcome this. I love to use the Rocks/Pebbles/Sand method that I read about in 7 Habits of Highly Effective People when I was a teenager. (If you’ve never read it, do – it is full of fabulous wisdom). Imagine a big jar – you have rocks, pebbles and sand to put into it. What order do you do that in?

Basically, you look at your week as a whole – maybe on Sunday night, maybe on Monday morning. Assess the tasks you have to get done that week. What are the really vital, key tasks? They are your ‘rocks’. You schedule them into your week. Next come the less urgent by still important tasks – they are your ‘pebbles’. Finally, all the other little niggly tasks are your sand – they get scheduled into the cracks.

This combines really well with the Urgent/Important matrix from the same book:

ui-matrix

{image from here}

This is a really helpful way to prioritise the oodles of tasks you have to do.

It helps you to realise that there are a LOT of things in your business that are urgent but not¬†important… and concurrently, a LOT of things that are important, but not urgent. These are often the things that get forgotten in the blur of keeping up – things like business planning, long-term goal setting, PR etc.

I hope those strategies help you, Elisa!

I’ve given you all some homework to do – take a few minutes to consider and answer the questions in the comments below. Don’t just read this and click away – devote 5-10 minutes of thought – RIGHT NOW – to your business time management strategies.

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Homework

Reply to the following questions in the comments:

  1. How effective is my current time management routine? 
  2. What aspects of my business have I been neglecting due to poor time management?
  3. Which of the above strategies will I find most useful? Can I commit to trying it for 1 week?

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Do you have a question for Jess? Just click the ‚ÄėFeedback‚Äô tab on the left of screen and send it in!

{C&T Q&A} How often should I blog?

blogs and coffee

This week’s question is from¬†Jennifer, and she asks:

To gain a readership or keep interest, how often should one blog? Daily, or just a few times a week…?

Thanks for your question, Jennifer – it’s a common one, for sure.

So, how often should you blog?

Honestly? I hate to say it, but it’s really up to you. How much time do you have to blog? Can you set aside an hour every day or a few hours on the weekend to write a week’s worth of posts? Or are you already hard-pressed for time to devote to your business, and even the thought of blogging once a week sends you into a tizzy?

Would you be better served sharing your work daily on social media like Instagram, Facebook and twitter and only blogging a few times a month?

This is one of those questions where there is not right or wrong answer – but let me give you a few basic principles that should help you make a decision as to what is right for you.

Be Consistent

Consistency in blogging is key. If you blog once a week… then blog once a week. Put it on your calendar and consider it as vital a part of your business as answering your email.

This is great for your sanity, as you’re not constantly wasting mental energy on whether or not to blog today… you just commit to yourself that yep, Wednesday is the day I need to get a blog post out there, and you make it happen. Then you can relax into the habit, and use that mental energy elsewhere in your business.

It goes without saying that the more often you can blog, the more posts you’ll be adding to your blog, which – over time – will mean more ways for people to find your blog and therefore, find you and your business. But don’t beat yourself up if you can’t blog every day, or even three times a week. And if you forget to blog one week, or just can’t? PLEASE don’t write one of those ‘oh hey, sorry I forgot/sorry I haven’t blogged in a while’ type posts. Because, to be frank, most people won’t even have noticed! But they WILL notice if they come across your blog and see an endless string of these apology posts.

Just get back to it and blog like you always do.

In short: do what you can, do it well, and give yourself a break!

Be Real

Most handmade peeps get this one right already, but I thought I should throw it out there. Don’t be afraid of being a real person and sharing your life. I always say that online you should always be you… but be the BEST you. Remember, everything you put out there on the interwebs will be there FOREVER, and it can all come back to reflect upon your business and brand.

Handmade is all about the connection between the maker and the buyer. Capitalise on that!

Be Focussed

What is the point of your blog? Is it to promote your products?

Then you need to write about them! But not necessarily in a ‘look what I made now go buy it’ way (though that’s okay once in a while, too!). You can share your design process. You can blog about your studio. You can blog about other aspects of your life that intersect with your product. If you make jewellery or apparel, do a ‘what I wore’ post that includes one of your own pieces. You can do a round-up post with a theme and include one of your own pieces. The choices are pretty endless.

Just remember: your blog is there to do one (or all) of three things – to inform, entertain, and inspire. If you’re doing one or more of these things with every blog post, you’ll be on the right track.

I hope that helped you, Jennifer! I believe that blogging creates an invaluable place for you to connect with your customers and fellow makers – it should be part of the foundation of any online business.

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Homework

Answer the following questions in the comments:

  1. What is the purpose of my blog?
  2. How much time per week can I allocate to blogging?
  3. What amount of blogging can I realistically commit to for the following 3 months?

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Do you have a question for Jess? Just click the ‘Feedback’ tab on the left of screen and send it in!

 {image by Jennifer Ramos}