Working with small businesses with their digital marketing the past 9 years (with Sidekick) has taught me a nearly uncountable number of lessons about challenges they face, watching many of them grow over the years.

Some of those lessons are more fun:

“If something’s going to throw a kink in plans, it will happen on weekend or holiday (cover your weekends and holidays).”

Some are more painful:

“Being everything to everyone will lead nowhere, in a lot of (wasted) time – (narrow your gaze).”

Some are somewhere in the middle:

“Most give up on a digital marketing plan too early to reap the rewards (impatience leads to inconsistent results).”

I would say, however, that most – if not all – of the things that slow down small businesses boils down to one simple thing:

Math.

Most small businesses are aware of their (raw) revenue numbers — “how much did you sell/bring in last year?”

Most also have an understanding of their profit – “what was your profit over the last 3 years”.

While these are the traditional numbers we all use to measure the financial success of a business, there are “upstream” numbers that can be much more important.

“What is the size of our market? (how many ideal customers/clients are there within reach?)”

“How many qualified leads from our market did we have last month, compared with last year?”

“What was our conversion rate on qualified leads last quarter?”

“What is our small business’ capacity (how many bookings/projects can we do per week/month/year?”

These are just some examples, but if you look closely, there’s a math element to each one of these questions:

“how large is your market”

“how many leads”

“conversion rate”

“how many bookings”

None of these have any reference to dollar figures or revenue — yet all heavily (heavily) influence them.

Not knowing if your market is growing or shrinking leads to not knowing how much to spend in marketing.

You don’t know how much you need to spend on marketing, because you don’t know how many leads you need.

You don’t know how many leads you need, because you don’t know how many sales you need.

You don’t know how many sales you need, because you don’t know how many bookings/projects you need.

You don’t know how many bookings/projects you need, because you don’t know your output capacity.

It. Is. All. Connected.

And. It. Is. All. Math. (And that’s ok).

Reverse Engineering Your Small Business

If you want to engineer a smooth running, successful (and growing) small business you need to reverse engineer it, first.

Start at the end.

Given your current staff/contractors, what is the most individual projects you can do in a week/month/year?

With that number of projects, how many individual sales do you need to produce that project count?

With that many individual sales, how many qualified leads need to convert?

Given your current conversion rate on leads, how many overall leads do you need to capture or generate those qualified leads?

With that number of overall leads, are there enough leads in my market to capture or generate?

Once you have these down, it becomes extremely easy to map out (and predict) a successful outcome (and with a little help from your accountant, you’ll be able to equate these dollar amounts/revenue – starting with revenue & profit per booking/project).

Side note: of course, each small business is going to be a bit different (every one of I’ve worked with over the years is a bit different), but the above sections should give you a general idea of how to break things down, starting with capacity.

There’s No Avoiding The Math, If You Want To Succeed (And That’s OK)

Profit. Revenue. Hours. Days. Weeks. Months. Years. Capacity. Projects. Sales. Conversion Rates. Leads. Marketing.

Marketing. Leads. Conversion Rates. Sales. Projects. Capacity. Years. Months. Weeks. Days. Hours. Revenue. Profit.

These are all things we count or measure.

No matter which way you lay it out, it’s all just… math.

Don’t Let Math Slow You Down

There’s only one thing that’s more terrifying than knowing what’s slowing you down – not knowing what’s slowing you down.

Math can make help make the unknown, known.

Make math your friend (or Sidekick).