Never Leave Money On The Table - Scrutinize Variable Costs - Wendy Dickinson

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​Wendy Dickinson - "Catalytic Conversation$"

Introduction
Today let’s turn our focus to variable costs.  The goal is to reduce your variable costs in meaningful ways to increase your profitability.  I’m working alongside you - as you work ON your business.  

Most of the world has enjoyed a number of years of relative profitability.  COVID19 has interrupted the way most do business, which for many, led to a decrease in profitability.  We know the recovery process will be gradual in many industries.  

As the Executive in charge, you are to lead yourself, your team, the ideas that you and the team generate, and the RESULTS.  For you, COVID19 is a Catalyst for Change.  How about this for a new motto?  Ready for anything - anytime.

I challenge you to make this the moment where you build out a dashboard full of metrics that deliver the messages that you need to successfully store 4 long term options in your back pocket - to build your family’s wealth, to grow your influence, to fund your retirement or next project.

If you need help, consider becoming a member of IBGR’s Community of Commerce.
As a member of IBGR's Community of Commerce you can:

1. Follow other users including the OnAir Talent and Executive Team at the station.
2. Ask and answer questions about starting, growing, and exiting the business from our OnAir team and each other.
3. Follow any member of the Community to stay abreast of their latest business insights as well as building your own following.
4. Start discussions to stimulate input from other members of the Community.
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6. Post and comment on posts and blogs.
7. Access and share content entrepreneurs and business owners can use.

So, roll up your sleeves, let’s get to work.
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Listen>Apply>Engage
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Show Objectives - The Why
​I hope you caught the last episode of my show with my guest, Mick Wienholt.  (You can catch up with Mick here: mick.wienholt@schooleymitchell.com) We worked on fixed costs reductions and the ways that you can increase profitability in a meaningful way.  We are going to do the same thing today with variable costs.

Key Issues - Owner Perspective:

1. Integrating frugality as part of the company culture.
2. Clarity in focus on profitability, reduction of costs (especially tail spend).
3. Use of a growth mindset by everyone in the, an expanded sense of awareness of the cycle of spending in the company as a whole.  

Frugality in the allocation of resources starts with YOU.  Attention to the KPI’s around cost structure allows you to generate those options for the future - the sale of the company, the reinvention of the company by you, the successful onboarding of investors, or allowing a family member to buy out your interests in the company.


What You Need to Know - The What

• EPISODE E5.03.3 Pruning Fixed Costs for More Than Pennies
• EPISODE E5.02.3 Implementing The Profit Plan - The Good, The Bad, The (O)X
• Determine the mindset of employees regarding spending.
• Identify the level of awareness around spending’s impact on profitability.
• Explore attitudes in expending time and energy as well as money.

What You Need to Do​​ - The How

1. Look at the timing of when  money goes out and the revenue comes in.  Make any adjustments to improve your timing in cash flow.
2. Determine if every expense listed is essential.
3. Itemize tail spend.  Identify buying/spending habits.  Implement a plan to mitigate & reduce costs.
4. Tie senior management compensation to frugal leadership.
5. Challenge research & development to do more with less.

Shows

• Previous: EPISODE E5.03.3 (O)X - Pruning Fixed Costs For More Than Pennies
• Next: EPISODE E5.05.3 (O)X - Planting The Money Tree - Profitability From Retained Earnings Investments

Resources

1. Secrets to a Successful Startup: A Recession Proof Guide To Starting, Surviving, & Thriving In Your Own Venture, Trevor Blake, New World Library, 2020.
2. “3 Lesson In Corporate Frugality From The Developing World”, Fast Co, by Navi Radjou, Jaideep Prabhu, & Simone Ahuja, 5/25/12.
3. “How to Make Your Employees Embrace Your Frugal Business Values”, Frugal Entrepreneur, 3/12.
4. “It’s Smart to Be Frugal - Something Many Forget During Good Times”, LinkedIn, Rob Bernshteyn, 10/25/18.
5. “Frugal Leadership - The Key To Co-build The Post COVID World”, Medium, by Navi Radjou, 2020.​​

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