Build to Enough | Navigating Uncertainty

On this episode of Build to Enough, Keila discusses strategies for small business owners to navigate uncertainty, including having financial reserves, adapting business strategies, and seeking expert guidance. Keila offers practical tips on how entrepreneurs can prepare for unpredictable changes in the economy or their industries.

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Website - www.krht.co

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Creators & Guests

Host

Keila Hill-Trawick, CPA, MBA

Helping entrepreneurs create and maintain the business they want | Building to Enough | LinkedIn Top Voice | Intuit Partner Council | Accounting Firm Owner

What is Build to Enough ?

Little Fish Accounting presents Build To Enough. The pursuit of endless growth and scaling can leave entrepreneurs feeling burned out and unfulfilled. This podcast explores how to build sustainable, purpose-driven businesses that align with your lifestyle and values, rather than defined by rapid expansion alone. On this show, we’ll reframe definitions of success, provide strategies for structuring companies around desired lifestyles, and share stories of entrepreneurs finding deeper fulfillment by focusing on “enough.” Join us as we discuss moving off the hamster wheel and building businesses with balance and meaning.

Warning: This is a machine-generated transcript. As such, there may be spelling, grammar, and accuracy errors throughout. Thank you for your understanding!

Keila Hill-Trawick: Hello. You're listening to Build to Enough, a podcast for entrepreneurs who want to scale at their own pace. I'm your host, Keyla Hill Traywick, and I'll be your chief storyteller and cheerleader in a world that glorifies endless expansion, we're tuning out the noise and discussing the beauty of enough. Each episode will dive into inspiring stories, practical insights, and strategies to cultivate sustainable success on your [00:00:30] own terms. So whether you're a solopreneur, small business owner, or aspiring entrepreneur, get ready for a refreshing take on the entrepreneurial journey. This is build to enough. I

Keila Hill-Trawick: n life, there is really no such thing as certainty, and uncertainty is especially common when it comes to small businesses. So today we want to talk about navigating uncertainty, what that means, how you can prepare for it, and how you're not alone when you're thinking [00:01:00] about how things might or might not go in your business in the future. All right. So when we're talking about uncertainty for small businesses, it can mean a variety of things from the economic downturns or changes in the economy that affect both you as a small business owner or your particular industry to market volatility and other external factors like local changes or a pandemic. All of these things can affect what happens in [00:01:30] your business, not to mention just the normal uncertainty of whether or not clients will renew, whether you're pricing is right and if you are trying to make business, uh, business pivots or changes, what that could look like in terms of your revenue and expenses going up and down, there's always going to be ebbs and flows.

Keila Hill-Trawick: But let's dig into first how you can be financially prepared for those. So one of the things that I constantly remind people is that your business funding is a lot like your personal [00:02:00] amounts, right? You want to make sure that you have a savings account that will cover you when and if there are any changes to your business income. So we recommend that all clients and non-clients save 3 to 6 months of business expenses. Now this starts with good bookkeeping, right? You need to know how much you're spending in these areas in order to know how much you need to save. But that's a good rule of thumb in terms of holding money to the side so that if anything happens, you [00:02:30] get sick. Somebody on your team has to change course. Anything that happens that may affect your revenue is really being accounted for with this cash cushion that you have available to you. We also recommend that once you get down below about three months of expenses, you may investigate other funding sources like lines of credit. We recommend lines of credit over loans because you don't have to take all of the money out. It is renewable, meaning that you put it back and then you can take some out when you need it.

Keila Hill-Trawick: And generally the annual fee is pretty low, so [00:03:00] we recommend that you just have one on hand in case you had to tap into it and just be blessed on the days that you don't, it's really important that you have your finances prepared. You never know what's going to happen, and you also don't want to be caught off guard or stressed when things do occur. Some things might be outside your control. Most things are outside of our control. And so the things that we can manage, like our cash, like our budgets, like those financial plans to really tell us what we need in order [00:03:30] for the business to run, that's going to be really important if you don't have your bookkeeping and financials up to date, though, this is going to be really difficult for you to stay close to. So I definitely recommend that you stay on top of it and or hire somebody to take care of it for you. But more than that, I want to make sure that you are reviewing it. It does you no good to have financial reports that you never look at. And when you do look at them, look at what it's doing to your cash. Look at how far you are off from budget. Is this a number that you need to shift in order [00:04:00] to make sure that you're accounting for it properly, and then saving accordingly? Think of things like taxes.

Keila Hill-Trawick: They are going to have to be paid, and so have a separate account to put that money to the side, so that when estimates and tax returns are to be filed, you've got the money and weren't expecting to use that for operational costs. Next let's talk about strategic adaptation. And that's really just a fancy way of saying look at what you're doing and see if it works. When we get into business, it can be easy to kind of think we [00:04:30] can set it and forget it. I have come up with these prices. I have come up with these services. We are good to go. We're just going to do this for insert X number of months, quarters, years here. But the landscape is constantly changing the ideas about what is good, right and valuable for the people that we are going to serve is constantly in flux, and we can't always keep up with all those changes. But what we can do is make a commitment to say at various points throughout the year, I will check in [00:05:00] and make sure that one what I'm doing is what I want to be doing. Two, that I'm serving the right clients within those services, and three, that I am pricing myself in a way that reflects the value that I am providing. All of those are really good ways to strategically think about your business and what that may do for you in terms of an economic change or times again, of uncertainty.

Keila Hill-Trawick: What do I mean by that? Well, if you see that you're serving a lot of clients that are in a very specific industry [00:05:30] and you didn't intentionally niche, this may be an opportunity for you to look into other areas, to kind of hedge your bets on the types of customers that you are serving. In reverse of that, if you are working in a specific niche. So if you are only working with a certain type of client and a certain type of industry, you may want to be on top of the news of what's going on in those areas, so that you can see those shifts in advance and know when you need to make changes as well. Some of the ways that we have thought about pivots [00:06:00] and changes is when Dai was a boon. A lot of our clients were making a lot of money. As a result, corporations were investing in that. They were making sure that they hired people at a rate that made sense in order to come in and talk to their companies. Maybe not surprisingly, that didn't necessarily carry forward. A lot of companies slashed those budgets or decided that it wasn't a priority for them, and so people would have lost money otherwise. Luckily for our clients that were in the space, [00:06:30] we were really able to have proactive conversations about what else are you doing in addition to the training? Are you doing speaking engagements? Are you, um, offering consulting or coaching in other areas, really kind of shoring them up so that when an economic downturn happened or when priorities just change for their customers, they weren't so solid in one path that they weren't able to make money in another one.

Keila Hill-Trawick: And then lastly, when we're talking about uncertainty and times [00:07:00] for small businesses, I would really encourage you to seek out expert guidance. On a previous episode, we talked about outsourcing and what it means to get additional help. That is not immediately on your team, and that's one way of getting expert advice. But also look at industry professionals. Look at your peers, mentors, other people who know about what you do, who might be able to give you some insights so that it's not all coming out of your brain. When you're a small business owner working by yourself, [00:07:30] it can be really difficult to figure out what are the resources that should be telling you what to do next. Finding experts that know more than you, or just have access to resources that you might not have access to, is really a good way to prepare yourself against those uncertain times that are going to show up for you. At the end of the day, uncertainty is a natural part of business. None of us know what's going to happen, and our best laid plans go to crap all the time because you just don't know what's going to happen around you. [00:08:00]

Keila Hill-Trawick: So instead of trying to avoid those times, try to be prepared for those times. Make sure that you're financially stable, that you have a money cushion in the bank. In the event that anything happens to help hold you over for the rough times, make sure that you're making strategic decisions within the company about what your next steps should be, or how you maintain what you're doing right now. And be in community with experts, mentors, peers who can really support you through these changes. Everybody's not going to have uncertainties at the same time. And so [00:08:30] what might be helped to you now may enable you to be helped to someone else down the line. I encourage you to apply these strategies. Let us know about the insights that you've received, or anything that you're putting into place to make sure that you're able to weather any storms, too. We'd love to hear from you at podcast at Little Fish Accounting. Com thank you for tuning in to another episode of Build to Enough. If you enjoyed today's episode, don't forget [00:09:00] to subscribe, rate and share the love with your fellow entrepreneur friends, and make sure to sign up for the Build to Enough newsletter. The link is in the show notes. Stay tuned for more episodes as we continue to redefine success one intentional step at a time.