New Business Owners, Here’s Why You’re Losing Money
If your product isn’t priced right, your business is already in trouble.
This is the 213th consecutive post on MrEmogical Notes. If you’ve been following this series and are finding value from this blog/ newsletter, please consider sharing this post with one person who you feel needs to read this for their betterment.
Introduction
I’m sure (read: I hope) you must have heard the statement, “business is a perfect blend of art and science.”
Well, let me simplify this statement for you even further.
Business is 90% art and 10% science.
However, that 10% science is what holds the ship for the rest 90% and allows the ship to keep sailing smoothly across all kinds of tides.
This note is about the 10% science of business.
The science aspect of business refers to the financial discipline.
Only when your business is profitable, will you be able to sustain it in the long run.
The most fundamental way to understand if your (or any) business is running profitably?
Unit economics
100% of businesses that fail, falter with their unit economics numbers.
No exaggeration, 100%.
So, let’s double click on this idea and understand this concept even better.
Unit Economics: The best friend/ worst enemy of any business
The most fundamental mistake that many new business owners make is that they have no clue about “unit economics” of their product.
Unit Economics refers to the direct costs and revenues associated with a production and sale of a single unit of a product or service.
It helps businesses understand whether they are making or losing money on each unit sold.
As a business owner, your first task once your business is afloat must be to master every component of the unit economics of your business.
Look at all the raw materials cost, labour cost, fixed costs, variable costs and derive the right unit economics cost for your business, ASAP.
Conclusion
When I was a new business owner, my biggest challenge was to learn the art of managing the unit economics of my business.
In fact, bad unit economics is the reason why my first business went south. So, if you’re between a rock and a hard place in your business, I can guarantee the main culprit is unit economics in one way or the other.
Do not take this lightly. I offer 1:1 consultations to new and growing businesses, and you must, reach out to me and let’s connect and work towards saving your business, TODAY.Your Thoughts!
If you’ve reached till this point of the post, I’m sure you must have some thoughts/ feelings/ opinions about what you’ve just read.
I’m done sharing what’s on my mind, and now is your turn to share your POV.
Tell me how you are processing the information that you’ve just read?
Do you agree with my thoughts?
Do you think I missed something important?
Do you disagree with something in particular?
Let’s continue this conversation (or ask your questions about the post) in the comments below.
Keep Going Keep Growing 🚀
Have I earned your share?
Thank you for reading the full post. Since you read this till the end, it’s safe to assume you found value in the content.
Please consider sharing this post with your audience on social media. You may end up helping someone who’s struggling in their career/ business because they don’t understand the importance of building their personal brand.
I’m sure if you think hard, you will easily come with a few names who you know must read this.
Share this with them, help them and earn your blessings.
Join The ProfitClan
If you’d like to get notes like these on the subject of money mindset, the law of attraction, financial literacy, and a lot more, make sure you subscribe to The ProfitClan.
The ProfitClan is an email newsletter by Paycheck To Profit (founded by Manish Ahuja) where you’d access to daily exclusive newsletters, freebies, notifications of new podcasts episodes when they go live, access to The PROFIT Masterclass, and a lot more.
Prompt used to create the image for the note
P.S.: Image made on Meta AI using the prompt, “Imagine a business owner with their hand on their forehead and stress visible on their face”