Build to Enough | Finding Your Capacity Sweet Spot

Determining the right number of clients to take on without compromising quality or burning out is essential. On this episode, Keila talks about how to set ideal revenue goals, assess your bandwidth across life and work, and strike the perfect balance between earning target income and maintaining sanity. Going beyond "work-life balance" into intentionally designing your business around your desired lifestyle.

Connect with Keila!
LinkedIn - www.linkedin.com/in/keilahilltrawick
Website - www.krht.co

RESOURCES:

Learn more about Little Fish’s suite of services and sign up for our newsletter at www.littlefishaccounting.com

Follow Little Fish Accounting at instagram.com/littlefishaccounting

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. Hello and welcome back to Build to Enough. I'm Keyla Hill Traywick and today we are going to talk about managing capacity. Now first let's define that. What does that even mean. Here we believe that enough is enough right. You got to set a line, a target, a boundary, after which you are not [00:01:00] interested in growing at any cost. And for us, managing capacity means that once you set that line for yourself, you got to determine how much you can actually do within it. How many clients can you take on which impacts? How much money can you make? How many people need to be on the team in order for you to achieve those? And if you've got questions on building your team, go back to the FSL before this. But first, let's jump into a couple of things to keep in mind around managing capacity. So one of the main reasons we wanted to talk about managing [00:01:30] capacity is because while I think that there are a lot of ways that work life balance is kind of a myth, there is something to be said for the fact that you've got to have balance so that work doesn't drown you.

Keila Hill-Trawick: I have been on the short end of burnout a couple of times and it was miserable. It was hard to do life. It was hard to do work. It was hard to be a good leader, a good wife, a good sister, a good friend. It was just difficult to show up in those spaces. And a lot of that was because [00:02:00] I was overwhelmed and understaffed at the firm. And so in addition to building a team that can support you first, you kind of got to know what you're building towards in order to know what your dream org chart would be like, you need to understand how many clients you're going to be looking to serve and what that means in terms of your revenue, so that you can support all the other things that you do remember. For us, it's really more important that you're building a life and then fitting work into it. Then that you are building a business and then trying [00:02:30] to fit your life around it. Now, as usual, we gotta talk about the finances. There are so many things financially that are going to impact your capacity. This includes cash flow. So how often are you getting paid versus how fast does money have to go out? Revenue.

Keila Hill-Trawick: Just literally how much money do you make and then expenses? What things do you already know you're going to have to pay for for your business? At Little Fish, we serve mostly professional service providers, which [00:03:00] means that we know that your top expenses are going to be people, software, travel, and potentially occupancy like rent, office spaces, utilities, stuff like that. You need to know how much that costs, because you need to know how much you need to make in order to cover those and cover yourself. So many people pay themselves last. It's common among small businesses and you're a priority. Like the whole point of you building this was supposed to be so that you could have freedom and hopefully make [00:03:30] more money. If you're not paying yourself, you're kind of not living your own dream. And so really, you want to make sure that these financial, uh, parameters are helping you to determine what your capacity is. I'll give you an example. If you charge $1,000 for a service and you need to make $10,000 a month in order to cover everything in your business, you need ten clients a month. Based on what you do and what you're offering for $1,000. Can you do that? Or are you undercharged? And should [00:04:00] you actually be charging $2,000 a month and taking five clients instead? That's a really simple example, but it also gives you a sense of like one. How many clients can I actually take and not get burned out? 2 a.m.

Keila Hill-Trawick: I pricing according to what I'm actually doing, or am I just throwing a number out? And three what value am I bringing to the client? It may turn out that the number isn't 2000, it's 5000. And if you don't take some time to say, I can give you this kind of one on one attention, [00:04:30] because I'm only taking this number of clients or I'm only interested in making this much per month, you do yourself a great service to really be able to provide value based pricing, as opposed to hourly or something like that. This also means that your bandwidth may cap for you how much you're being able to take on everything from family life to other hobbies or interests, to even other businesses that you're running, [00:05:00] can limit your capacity for how many people you can take on. Remember, you always want to do what you're doing with excellence, and that means you want to meet the promises that you're making to clients, about the service that you're offering and the transformation that you're telling them that you're going to give them. That is very hard to do when you've got a million people on your plate, because that's a lot of people asking for you. And so once you know, hey, with all this other life that I have going on, this is how much time I have to dedicate to this business [00:05:30] that is going to impact how many clients you can take, how much you charge, and what you're able to offer in order to be really bound within that capacity that you actually have availability to serve.

Keila Hill-Trawick: Now this leads me to my third point, which is really finding that balance between client capacity and financial stability. I know the world will tell us as entrepreneurs [00:06:00] that you should be growing by any means, and usually that means taking on all the clients. If somebody is willing to pay you, let them pay you and do the service. But again, if we go back to managing capacity, you can't actually serve all those clients well. Are your systems in order? Is your team in order? The number of people that you can serve when it's just you is going to look way different than who you can serve with a team of five or a team of ten, and you got to be realistic about that. At the same time, we need money like none [00:06:30] of us started businesses unless you have a nonprofit, for it to just be for the world. We want to be profitable. And so that means that you're going to have to make that balance. You're going to have to determine, are there projects that I take on that are bigger projects require a little bit more work, but I can do them just as me, and they pay me enough to cover me for a few months. Or is it more beneficial for you to take on smaller projects or retainers each month? And yeah, I'm going to make less per client, but that's about the capacity that I have every [00:07:00] day or every week to really give to these projects, to make sure that they're happening as we plan.

Keila Hill-Trawick: So make sure that you're not doing one to sacrifice the other. We can't just think about capacity or just think about the finances. We've really got to mesh those to the balance that makes the most sense for you as a business owner, so that again, you're building and growing and working in the business that you want to work in while still leaving space, time and reserves for you to be able to rest and spend time outside of your work. Now, [00:07:30] we kind of touched on this, but let's dig a little bit more into quality over quantity. I will say that for professional service providers, it can be very easy to think if it's in my wheelhouse, I can do it. I know when I first started Little Fish, if you ask me anything related to accounting, I was like, I could probably do that. And then I would make a way. I would charge people for it and I would do it sometimes. It was great. I learned something new. I did really well at it, and I got to give a client something that they really needed. But sometimes it sucked. [00:08:00] I got underpaid or didn't make any money off of it, because it took me so much time and effort to actually do it that while I did end up completing it, it kind of felt like trash.

Keila Hill-Trawick: And so when we think about quality over quantity, we want to think about that for ourselves too. Yes, we want to give clients what they need. We want to make sure that they are being served with care, with the highest levels of performance and expertise, because that's what they pay us for. But also, it doesn't matter if you make $1 million and you burn out and you're tired [00:08:30] and you're exhausted, you're having some mental health challenges. If all of that has to come along with the money, then yeah, it's not the quality that you really signed up for. Another way that we manage quality over quantity at Little Fish is to have an application process for clients. Now, this won't be the same for everyone, but as we've narrowed down exactly who we want to serve, we found that it's not in anybody's best interest to get on calls to potentially try to sell you on things that either aren't for you or aren't a good fit for us. And so we [00:09:00] start by having a really transparent website that lays out everything that we will do for people, what we include and what we don't include, so that you've already got a good sense of what would make the most sense for you in terms of when you're partnering with us. The next step is that we accept applications. Those don't automatically go to a discovery call. Why? Because we want to make sure that it's a good use of both of our time.

Keila Hill-Trawick: I don't want to get you on a 30 minute call for you to say you can't afford [00:09:30] it, or this isn't the service that you wanted, and I don't want to get on the call to tell you that, oh, based on what you submitted, you're not a good fit for us. That could have been an email. Y'all know how they say there's meetings that could have been emails. This is one of those. And so how we try to mitigate that is by having an application process that allows you to tell us a bit about your business. We review it, match it up against the services that we offer, and then make the determination, should we proceed with a call to figure out if this would be a good fit, [00:10:00] based on information that indicates that we would, or do we send you to another resource or referral source in order to get you another partner that would be a better fit? A good example is that little fish doesn't do ad hoc tax returns. So if you don't want to be part of our year round service and just want your tax return done, we don't want to have to have you get on a call to discuss that. We can really send you to some partners who can really serve you better if that's a better fit, or at the very least, let you know that that's not [00:10:30] what we have.

Keila Hill-Trawick: Lay out again, what we do offer so that you know what you're walking into. If we do get on a call again, remember quality over quantity. You'd much rather have ten ideal clients who value you and are paying you what you're worth. Then 100 clients that are underpaying. You and that you feel like you're not really having the best relationship with them. And the end of the day, this is a human centered relationship. This is the people business. And so everything you want to do, you want to make sure that you can give really your emotional support [00:11:00] towards. And that's a lot easier to do when you're not exhausted. All right. So we've talked about capacity planning. But like how you may be wondering if I know that I need to figure out how to manage my capacity. Where do I start. The first thing is gut check. How does this year feel? How does this month feel for your work? Are you looking at any of your projects and saying, yo, I don't want to do those anymore, or others where you're like, I'd really like to dig deeper into this kind of work. That's going to be your first step, because [00:11:30] that's going to lay the foundation for the kind of work that you want to do. Next, figure out how much you actually make. If you took the work. That is only the work that you want to do. How much money would you make? Are you pricing that accurately? Honestly, if you weren't doing the work that you hate, could you charge more for this, add more value to it, and take less clients? That's going to be a really good mind shift for you to have a better sense of like, it's not that I'm doing less and it's not necessarily that I need to do more, it's that I'm really being [00:12:00] intentional about the type of work that I'm doing, sharing that with clients in a way that feels valuable and charging accordingly.

Keila Hill-Trawick: The third thing that I recommend that you do in managing capacity is think about that org chart in order to perform those services, to make the money that you need to make, who needs to be on the team? Is your first step in admin, or is your first step in operations consultant to help you to come in and set up all your systems. Remember, you want it to be easy for people to work with you. And so if all of the marketing and all [00:12:30] the work that you put into the world works, then once they get in, you want it to feel like a seamless experience for you and them. That's going to be part of your capacity to write. The easier it is for you to be able to perform the work, the more space and time that you have to just breathe in between the work and then finally know that these things will change. Life happens. Your capacity may be high at certain points of the year and low at other points.

Keila Hill-Trawick: For us, tax season is not the time when I can start thinking [00:13:00] about new projects or new ways that I want to improve service. My capacity is already limited there, but summers are spaces where we can start talking about as a team. What adjustments should we make? What does your business look like? What are your seasonal highs and lows so that you can start making some decisions outside of when you are just in the brunt of work to really work on the business, and not just in it. At the end of the day, again, we want to make sure that you know what you're enough is and are able to plan around [00:13:30] it. Your ability to do so is going to start with you, and then kind of have its tentacles into every other piece of your business and your team. If one of those things in managing your capacity is getting accounting off your plate, we would love to support you. Feel free to find out more about little fish, what we do, and how we serve at Little Fish Accounting comm. Thank you for tuning in to another episode of Build to Enough. If you enjoyed today's episode, don't forget to subscribe, rate and share the love with your fellow entrepreneur [00:14:00] 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.