How to make $120,000/year: breaking down the numbers step by step
Setting and achieving financial goals is a crucial aspect of running a successful business.
To determine your financial goals start by considering your ideal income, business expenses and personal financial needs.
Once you have a clear understanding of your desired annual income you can break it down into monthly and weekly targets.
Let’s do some numbers as an example.
Let’s say you want to make $120,000 in annual revenue
Remember - revenue is not what you will be “taking home” in salary or income, as you’ll have tax and expenses to pay from this revenue.
Let’s break that annual revenue target down into something that’s more helpful for us to aim for each day.
$120,000 per year = a target of $10,000 per month
Now let’s say your fees for an average design project are $10,000.
That means you need to be aiming to book one new design project every month in order to hit your $120,000 annual revenue target (i.e. 12 projects of $10,000 = $120,000).
In order to book one project per month it means you need to be doing a number of initial paid design consultations (as not every design consultation will turn into more work).
But let’s say you have been tracking your conversions from your paid design consultations and you know that you have a 25% conversion rate for your paid design consultations to turn into larger projects.
That means that in order to book one larger project each month you need to be doing at least 4 paid design consultations each month.
That’s about one each week.
So now your annual revenue target of $120,000 seems much more achievable and you have something very tangible to be aiming for - i.e. to book one paid design consultation every week.
So how do you get those paid design consultations?
Well another metric you should be tracking is how many leads you need in order to book an initial design consultation.
This is why I think having a booking system on your website (for people to book the initial consultation with you) is really helpful.
Because then you can track how many people per week are coming to your website and how many design consultations you are booking from this website traffic (this becomes your conversion on traffic to booking a design consultation).
Let’s say you learn over time that you have a 1% conversion rate on your website - i.e. for every 100 visitors that come to your website, one of those will book a design consultation.
That means that in order to book one design consultation each week, you need to be driving at least 100 people to your website via different lead generation strategies every single week.
Some of these lead generation strategies might include:
creating lead magnets they can download (and telling them about that in your Instagram stories)
creating a webinar or short video course that they can watch (e.g. about how to get started with their renovation project or some other topic they would find helpful)
sending them over from your Instagram page to read a blog post you’ve written
creating a call to action in a YouTube video to go over to your website to learn more about your services
creating “Pin-able’ images for all your website content and driving traffic over from Pinterest to your website
You focus every day needs to be on how to get 100 warm leads coming to your website because you know that 1% of those warm leads will book a paid consultation with you.
By the way - that’s about 15 leads each day.
So your aim is no longer this arbitrary goal of trying to make $120,000 per year.
Instead your daily aim now is how to drive at least 15 people over to your website so you can:
have at least 100 warm leads coming to your website each week
which will turn into at least one person booking a paid design consultation with you
which will turn into 4 paid design consultations each month
which will turn into one larger paid project each month @ $10,000 per project
which will help you hit your $10,000 monthly revenue target
which will mean you will hit your $120,000 annual revenue goal
Building a successful business is not about sitting back and “hoping” you find clients or make money.
You need to know your numbers and start taking the specific actions that will drive your business results.
Although the numbers in this post are all just made up to illustrate a point, it’s important that you start to track these numbers for yourself.
You can’t run your business blind. You absolutely must know your numbers!
Trust me - if you take your business metrics more seriously you will watch your business grow a lot faster.
Thanks for reading and catch you in my next post :)
Clare x
Dr Clare Le Roy
Courses and Templates for Designers and Architects
DO YOU WANT TO….
Improve your professionalism?
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Bring in more revenue?
Create better systems and processes?
Then check out my business courses and templates for designers and architects.
These courses and templates leave you with work done - not just a long list of things you need to do next. We have a really strong focus on taking action and getting things created that improve your business.
