In this episode, Troy and Simon talk about all the things that a freelancer needs to measure in their business. And, as usual, we bring you the latest news including the Slack acquisition.
Speaking of latest news… Troy tells us that we have replaced the segment “This Pisses me Off” with “What Made the Wee Come Out”. Yes. I know. Only Troy could have come up with a segment name like this!
Warning: Troy has a cold and has taken Sudafed. We think this is the reason for his strange behaviour and hysterical laughter in this episode.
Watch the Video
Stuff That Happened
At the 4.35 minute mark, the guys bring you the latest news.
Slack Acquires HipChat, Moves Blog from Medium to WordPress
Slack has announced that it has acquired HipChat from Atlassian and is retiring it. Slack is also moving its blog over from Medium to WordPress. Find out more from WP Tavern.
Chrome Starts Telling Users HTTP Sites Are Not Secure
Google is releasing Chrome 68 that will begin marking pages not using HTTPS URLs as not secure. Simon points out that this is a good opportunity for you to get in touch with your clients and let them know why they need maintenance and security if they on still using HTTP.
Troy then talks about how it may be a little weird if you contact someone who you built a website for a couple of years ago and tell them that it is no longer secure. So you need to be careful how you approach the conversation.
One of our new Flight Instructors, Stephanie Campanella spoke at WordCamp Sydney about hiring. Her presentation was called “Hire Before You Drown”. Well done Steph - we are super proud of you!
Side note: Just in case you’re wondering what a “Flight Instructor” at WPE does - they are the mentors for our members.
What Made the Wee Come Out?
So what do you think of the new segment name? The guys were getting sick of trying to find something to be pissed off about every week because they aren’t always angry. In fact, most of the time, they’re pretty happy - living the WordPress dream!
Ok back to the program... At the 11-minute mark, we talk about a post in our Facebook community from one of our members - Shane Rielly.
I get a fair amount of traffic from those little footer links on sites I have built so I decided to create a landing page for them and personalise it depending on which site the visitor is coming from. I think it's a fun little thing that might get a visitor's attention so I thought I'd share here for interest's sake. I used a tool called Unless.
Troy saw this post.. and guess what? A bit of wee came out.
Let’s Get Unstuck
This week we asked the Facebook group what they needed help with in terms of measuring data for their business and Amy asked:
A big thing for me at the moment is measuring exactly how much time is spent by everyone on my team for every task. I want to get a good overview on how long everything is taking so that I can calculate project budgets better and also identify any areas that could be improved through better processes or training opportunities.
The point here is improving because it doesn’t always matter how you get there. There are other ways that you can understand what is being produced and achieved including getting feedback from the team. If you’re looking at where someone is being efficient and time tracking then it can be quite overwhelming. So regular and consistent meetings will be a good way to get there.
The Golden Nugget
Why Is Measuring so Important?
Around the 21.30 minute mark, we dig into the Golden Nugget.
You know the how the old saying goes... "you can't manage what you can’t measure".
It’s about having visibility and being realistic and asking questions such as "Am I profitable?" "Am I working too hard?" "Where is this business going?"
There’s so much to measure that you can actually get lost, so you need to know what to measure. What will give you the biggest improvement within the next 30 days?
It all comes down to profit.
At the 23.30 mark, Troy laughs hysterically for about 2 minutes. You see? Sudafed!
What Are You Really Measuring?
Take a step back and look at the bigger picture. If there is a big number that has moved, then there is likely a lot of other smaller numbers that have moved.
What we measure at WPE is the profit per recurring revenue customer. If we get that right, then what that means is that the cost per lead is going down and the lifetime value of the customer is going up. Therefore, you don’t need to measure those things - we only need to know the profit per recurring revenue customer.
Find one or two numbers which encapsulate a whole lot of other levers that you can pull. So for you, it might be the cost per lead. This will be the big domino that knocks over the other dominos.
How Do You Measure Profit?
We use Grow.com which pulls in data from different sources such as Xero and allows you to see it all in the one place.
Another hot tip from Troy is to read Scaling Up. This was the book that got him asking himself what one number in his business would reflect everything else that’s going on?
If you’re trying to get clients. Look at profit per client. Getting clients is easy, but getting profitable and good quality clients is the challenge. So here is Troy’s challenge for you:
Note: Don’t include recurring revenue here
- Work out of all of the clients that you currently have and have previously worked with since you started your business.
- Work out the total profit that you have made.
- Divide that by the number of projects you’ve worked on and work out how much each client is worth on average.
Confused? Don't worry, we have an awesome Tool of the Week to help you.
Tool of the Week
At the 36.30 min mark, Simon shows us something he prepared earlier- a project profit analysis template. List out your projects, what you invoice and the costs including time and margins. It's pretty simple and will help you understand what you did well and not-so-well.
We also have another template to help you track what your team members are working on to find out things such as what the ad spend is, how many people you reached and how many leads were generated.
It's a good idea to have around one to three KPIs for the business and around one to three per team member.
Nice and easy!
We'd love to hear from you. Tell us what your measuring in the business in the comments below.
This is your show, so don't be shy and let us know the number one thing that you're struggling with in your business at the moment and we will do a show on it!
Important note: we are in no way affiliated with Sudafed nor was this meant to be an endorsement for said brand.