If you are running a business or planning to start one, these are the 11 factors determining whether your model will be profitable.
Join our Diamond Certification to fast-track your success: https://sidz.co/diamond
In this podcast episode, you will learn:
- The importance of passion in your business and why it's the foundation for overcoming challenges.
- How to determine if your passion is solving a market problem or merely a hobby.
- The significance of defining your target market and understanding their unique needs.
- How to assess market potential and trends to align your business model.
- Strategies for identifying your business's unique selling point (USP) or X-factor.
- Pricing strategies that work for different markets and product ranges.
- The crucial role of effective marketing in making your business visible.
- The benefits of one-to-many selling and creating automated systems.
- The value of customer reviews and feedback for product improvement.
- Cash flow management and its impact on long-term profitability.
- The importance of adaptability and staying flexible in a changing business landscape.
Tune in to gain valuable insights into these 11 factors and discover where your business stands in terms of sustainability and profitability. Whether you're a seasoned entrepreneur or just starting out, this podcast provides actionable advice to help you thrive in the business world. Subscribe now to stay updated with future episodes and take your business to the next level.
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Siddharth: There are 11 factors that you need to evaluate your
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Siddharth: business on if you want to actually measure the sustainability
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Siddharth: and profitability of that business over time.
00:00:08
Siddharth: And this podcast, I actually want to answer that question
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Siddharth: on how do you know whether the business model that
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Siddharth: you currently have will be sustainable and profitable or not?
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Siddharth: Because ultimately, business is about solving problems, it is never
00:00:22
Siddharth: about your product. Ok. And it's about solving it in
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Siddharth: an efficient way where your customers are able to see
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Siddharth: the value and the profitability is the
00:00:30
Siddharth: just the outcome of it. You know, the value exchange
00:00:33
Siddharth: is the profitability that's going to be there. And of course,
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Siddharth: the repeat buying that your customers are going to be
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Siddharth: having with your products and even the referrals that they're
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Siddharth: going to be bringing based on the great customer experience
00:00:43
Siddharth: that I've had with you, if they're going to be
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Siddharth: asking other people to also come and experience your product. Now,
00:00:47
Siddharth: these are all the different factors. So what I'm gonna
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Siddharth: do is I'm going to go through this one by one.
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Siddharth: There are 11 factors and what I would like you
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Siddharth: to do is make note down, make note of these
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Siddharth: 11 factors
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Siddharth: and also map yourself on a scale of 1 to
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Siddharth: 10 on how good are you in each of these
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Siddharth: 11 areas. So whether you're currently running a business or
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Siddharth: you're planning to run a business and you have a
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Siddharth: business idea in mind, or maybe you're in the coaching
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Siddharth: or a knowledge, business map each of these 11
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Siddharth: areas on a scale of 1 to 10 as I'm
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Siddharth: competing this particular podcast. And by the end of this,
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Siddharth: you would know exactly where you stand and which areas
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Siddharth: you need to improve. Ok. Number one is passion. Do
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Siddharth: you really love
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Siddharth: whatever you're doing what a business that you have taken
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Siddharth: like for me, it's a knowledge business. I teach people
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Siddharth: on how to become coaches. I teach people how to
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Siddharth: launch digital business and digital products. This is something I
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Siddharth: love I can, for me, it does not seem like
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Siddharth: work at all.
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Siddharth: I do at least 4 to 5 training sessions every
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Siddharth: single week for my different groups of people. And it,
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Siddharth: it just feels so much in tune with my persona
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Siddharth: and my my being because if you don't have a
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Siddharth: passion in the topic, you will not have the, you know,
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Siddharth: the grit to overcome the obstacles and challenges and to
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Siddharth: go deep and innovate and do research and stuff like that. Ok.
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Siddharth: So
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Siddharth: whenever you face an obstacle, you will immediately quit or
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Siddharth: you look at the next trend to jump to. So
00:02:12
Siddharth: never pick a business model or an idea. If you
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Siddharth: don't love doing it, that's the first metric. So score
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Siddharth: yourself on a scale of 1 to 10. OK. Second is,
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Siddharth: is your passion solving a problem in the market?
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Siddharth: See if your passion does not solve a problem. For example,
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Siddharth: I have a passion in music. I make music at
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Siddharth: home and all of that, but it's not solving a problem.
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Siddharth: So if your passion does not solve a problem, it
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Siddharth: is only a hobby. But let's say you have a
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Siddharth: passion in cooking
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Siddharth: and you also want to solve a problem by launching
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Siddharth: a youtube channel on just like the best Punjabi cuisines
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Siddharth: and stuff like that. So once you take the problem
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Siddharth: focused approach, we are not just you're not just cooking
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Siddharth: for yourself and for your pleasure at home, but you
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Siddharth: actually wanting to give some knowledge out there to serve
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Siddharth: others who are having similar problems. Then there is a
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Siddharth: business model in there. If your passion does not solve
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Siddharth: the problem, there is no business model.
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Siddharth: The third area is getting clear on your target market.
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Siddharth: If you're going to say that my target market is
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Siddharth: from age 20 to 40 or say 20 to 50.
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Siddharth: If everybody, if you're trying to sell to everybody, you're
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Siddharth: selling to nobody. So you have to be very specific
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Siddharth: on who are you serving and what problems are they facing,
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Siddharth: for example, a
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Siddharth: 18 to 20 year old, a male living in a
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Siddharth: metro would have completely different problems as compared to a
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Siddharth: 45 to 50 year old, a woman who is living
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Siddharth: in the same metro city, different mindset, different problems, different wants, aspirations, desires.
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Siddharth: So number three is get your target market clear.
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Siddharth: Number four is you have to test the market potential
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Siddharth: and see if there is a trend over there. For example, when,
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Siddharth: when COVID happened,
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Siddharth: starting a fine dining restaurant at that point of time
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Siddharth: would have been the worst idea.
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Siddharth: But launching a cloud kitchen would have been a great
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Siddharth: idea because everybody was at home. So you also have
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Siddharth: to check and see whether there's a market potential. And
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Siddharth: there are many businesses today that are getting outdated and
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Siddharth: they are not willing to adapt and change, which I'll
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Siddharth: come towards the end. But you have to look at
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Siddharth: market potential so that you don't swim against the current.
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Siddharth: You're gonna be swimming with the current and you're going
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Siddharth: to be riding the trend. Now, the business model that
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Siddharth: I'm in right now, which is a knowledge business.
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Siddharth: I'm pretty much riding the wave. I started this in 2018,
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Siddharth: there were 30 customers with just a four member team.
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Siddharth: And the reason we were able to ride this wave
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Siddharth: is because I align myself to the market potential and
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Siddharth: I had a passion in it. And um I was
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Siddharth: solving a problem in helping people find their niche and
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Siddharth: launch courses. And I was very clear that my target
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Siddharth: market are experts, coaches and trainers. See that's the reason
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Siddharth: I was able to acquire customers really fast
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Siddharth: because of the market potential. So again, evaluate yourself on
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Siddharth: a scale of 10, whether the business model, what you
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Siddharth: have is having a good market potential.
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Siddharth: Number six, does your business model have an X factor?
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Siddharth: In other words, A USB,
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Siddharth: how are you able to differentiate yourself from everybody else?
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Siddharth: Like even in my coaching business, there are many people
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Siddharth: in the coaching and training industry, uh you know, selling
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Siddharth: similar stuff, you know, high ticket coaching, high ticket consulting
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Siddharth: or you know, funnel building or this and that I
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Siddharth: think the X factor that I bring to the table
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Siddharth: in my community is the element of building communities and
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Siddharth: also
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Siddharth: having a value driven community system, of course, a spiritually
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Siddharth: grounded business where I'm also targeting people are more family
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Siddharth: oriented in my community. So people who are, who are
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Siddharth: natural tribe builders and who want to make a difference
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Siddharth: in the world. So even though I'm teaching the same
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Siddharth: topics that others may teach, but I'm able to attract
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Siddharth: a market
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Siddharth: who vibe with my vibe, which is
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Siddharth: rooted in value systems, in spirituality as well as in
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Siddharth: contribution to society. OK? And of course, the tactical knowledge
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Siddharth: is always going to be there. So you need to
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Siddharth: find out what is your X factor? What are your
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Siddharth: core values that can be used as US P and
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Siddharth: of course, my US P if you see in all
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Siddharth: of my courses and content, if you ask any of
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Siddharth: my students,
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Siddharth: I don't beat around the bush straight to the point
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Siddharth: point shooter style teaching. And that is what has resulted
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Siddharth: in over 7000 plus reviews at five star on Trust
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Siddharth: pilot if you go and search for it. So the
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Siddharth: X factor when I started, I did not have an
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Siddharth: X factor,
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Siddharth: but the more I became a student of my topic,
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Siddharth: the more research I did and the more I I
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Siddharth: started to simplify things for my students to get results.
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Siddharth: And the more success stories I started to generate, uh
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Siddharth: the X factor started to emerge.
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Siddharth: Number seven is pricing. How exactly are you pricing your strategy? Ok.
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Siddharth: What's your pricing strategy for your products? So many of our,
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Siddharth: you know, Indian coaches and trainers, they, they listen to
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Siddharth: people from the Western world, from us, from the Taiwan
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Siddharth: countries and everybody is talking, you know, the dollar value
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Siddharth: and stuff. And what I've observed is many of those
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Siddharth: strategies don't work in India.
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Siddharth: I've been very focused on India right from day one
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Siddharth: though I have a good 10% of my customers from abroad,
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Siddharth: from other parts of the world. But the pricing strategy,
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Siddharth: whatever I have come up with, it works beautifully across
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Siddharth: all geographies and more tuned for India because of the volume.
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Siddharth: I mean, I've been able to attract over 30 students.
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Siddharth: How is it possible because I got the pricing right? Ok.
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Siddharth: Now what's the pricing strategy
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Siddharth: for a knowledge, business
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Siddharth: keeping your entry product under ₹10 is a sweet spot.
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Siddharth: But above 5000 below 5000 attracts a particular strata of
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Siddharth: society between 5 to 10 attracts a particular caliber of
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Siddharth: people are coming in who have the affordability to invest,
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Siddharth: say 20, 1 lakh, two lakhs and above.
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Siddharth: So the reason I was able to make my business
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Siddharth: model profitable is because I have a seven triple nine
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Siddharth: starting product, I have a 20 mid layer product and
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Siddharth: then I have a two LACS back end product. And
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Siddharth: based on the way that I have positioned my products,
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Siddharth: which is all additional products
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Siddharth: out of 10 people,
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Siddharth: two people buy my two lac product. So if 10
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Siddharth: people buy 8000 product, two of them end up buying
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Siddharth: a two lac product. So in the last four or
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Siddharth: five years, I've been doing this, over 30 students are
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Siddharth: there at my, you know, in this range of the
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Siddharth: 5 to 10 product. And from that, we have close
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Siddharth: to 4000 people who have bought my higher ticket product.
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Siddharth: Of course, now it is two lacs. But when I
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Siddharth: started off, I started off at a lower price point.
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Siddharth: But the principle is when you create different,
00:08:30
Siddharth: this is what we call is a value ladder. OK?
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Siddharth: A different ladders of products where people are able to
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Siddharth: see a higher value when they, when they pay more
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Siddharth: and come to the next level, uh that's going to
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Siddharth: be taking the game to the, to the next level. See,
00:08:43
Siddharth: the simple logic is even in mcdonald's right,
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Siddharth: they, when you go to buy a burger and the
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Siddharth: person on the counter would ask you, would you like
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Siddharth: to add some fries along with this? And if you
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Siddharth: see the pricing of the medium size fries and the
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Siddharth: large fries is very negligible. So people that they would
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Siddharth: go for the larger fries, OK, where they feel the
00:09:02
Siddharth: quantity is more but just for maybe a dollar or more.
00:09:04
Siddharth: But this is this one small tweak, it actually has
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Siddharth: helped them boost their profitability and and then pretty much
00:09:10
Siddharth: crack the code on the pricing model
00:09:12
Siddharth: that for different markets. So what am I coming to
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Siddharth: share with all of you is if you want to
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Siddharth: know whether your business model is profitable or not, you
00:09:18
Siddharth: got to get the pricing, right? And what pricing strategy
00:09:20
Siddharth: I shared with you right now is for a knowledge business.
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Siddharth: But if you're into any other kind of business, you
00:09:25
Siddharth: got to look at the what pricing fits well. And again,
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Siddharth: prices in your own mind in the beginning, you can
00:09:30
Siddharth: start with lower pricing.
00:09:31
Siddharth: And then as you are able to generate more results,
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Siddharth: more success stories for the people in your community, then
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Siddharth: you can increase the price.
00:09:38
Siddharth: Next is marketing,
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Siddharth: a lot of people have great products but they are
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Siddharth: not known in the market. They are not seen in
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Siddharth: the market because their marketing sucks. Now, what do I
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Siddharth: mean by marketing putting yourself out on the internet, on
00:09:52
Siddharth: social media in the form of, you know, Instagram reels,
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Siddharth: youtube videos, podcasts like this blogs, articles, Facebook, linkedin and
00:10:00
Siddharth: being all over the place and sharing valuable pieces of
00:10:03
Siddharth: content to attract people coming to you. So if you're
00:10:04
Siddharth: not actively marketing and selling, there is no point having
00:10:08
Siddharth: a great product.
00:10:09
Siddharth: OK? And even when it comes to selling, my form
00:10:12
Siddharth: of selling has always been one to many selling. OK?
00:10:15
Siddharth: Though I do, I've done 1 to 1. I even
00:10:17
Siddharth: now I do a lot of 1 to 1, but
00:10:18
Siddharth: my selling process is one too many. So people watch
00:10:21
Siddharth: my youtube video, they click on the link or they
00:10:23
Siddharth: listen to my podcast, they click on the link, they
00:10:25
Siddharth: come to my webinar, they attend the whole 90 minute webinar.
00:10:27
Siddharth: All my webinars are automated. It happens every single day
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Siddharth: and the end of the webinar, I give them an
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Siddharth: offer and people buy so daily I'm getting sales coming
00:10:35
Siddharth: into my system
00:10:37
Siddharth: because of creating an automated system like that. And if
00:10:39
Siddharth: you would like to know more about that. Please click
00:10:41
Siddharth: on the link in the description and get to my
00:10:44
Siddharth: webinar or you can go to sidz .co/ live and
00:10:48
Siddharth: attend my next webinar to see exactly how I do it.
00:10:51
Siddharth: Number nine are customer reviews. If you want to know
00:10:54
Siddharth: whether your business model will be profitable or not. Are
00:10:56
Siddharth: you able to get a quick feedback from your customers
00:10:59
Siddharth: on how good or bad your product is? In the beginning,
00:11:01
Siddharth: in the beginning stage, my product was not very good,
00:11:04
Siddharth: but then I was able to quickly capture the feedback
00:11:06
Siddharth: from my customers and I was able to quickly improve
00:11:08
Siddharth: my products so that,
00:11:10
Siddharth: you know, I don't even have a single customer review
00:11:12
Siddharth: saying that whatever I paid for, I did not get
00:11:14
Siddharth: the value, you know, that you will never see in
00:11:16
Siddharth: my community. In fact, we have one of the lowest
00:11:18
Siddharth: refund rates in the community and we are very quick
00:11:21
Siddharth: to give refunds if anybody is not even seeing the
00:11:24
Siddharth: value in what we are offering because we know that
00:11:26
Siddharth: for every ₹1 that anybody gives us, we are able
00:11:28
Siddharth: to give them minimum ₹10 if not ₹20 in value.
00:11:31
Siddharth: So customer reviews,
00:11:33
Siddharth: in fact, you can go and check out trustpilot and
00:11:35
Siddharth: read all the reviews. It's not just an awesome product
00:11:37
Siddharth: or a great teaching or a nice webinar kind of reviews.
00:11:41
Siddharth: There are many detailed reviews that if you go read,
00:11:43
Siddharth: you will be able to understand the emotion of the customer.
00:11:45
Siddharth: And I read these reviews every single day just to
00:11:47
Siddharth: understand
00:11:48
Siddharth: how I can improve. And if I'm really delivering a
00:11:50
Siddharth: good customer impact and my inspiration for this has been
00:11:54
Siddharth: two major companies, two big companies, one is Apple and
00:11:56
Siddharth: other is Amazon. Ok. These two other two companies I
00:12:00
Siddharth: observed they have been the most customer centric and they've
00:12:04
Siddharth: been very simple in their way of, you know, giving
00:12:07
Siddharth: a great customer experience.
00:12:10
Siddharth: Number 10, how do you know whether your business model
00:12:12
Siddharth: will be profitable or not cash flow management? You can
00:12:15
Siddharth: do all of this, you can do all the marketing,
00:12:18
Siddharth: you can have everything and all the selling will be
00:12:20
Siddharth: very good, good customers. But if you are not able
00:12:22
Siddharth: to manage your house, the money in your house in
00:12:24
Siddharth: your business, there is no point doing anything else
00:12:28
Siddharth: for me. I believe in frugality because uh constraints breeds
00:12:33
Siddharth: uh resourcefulness. And I like to keep my teams very lean.
00:12:37
Siddharth: I like to keep my outflows as much as possible.
00:12:40
Siddharth: I don't like to just spend money just because I'm
00:12:41
Siddharth: making money and I reinvest my money back into technology.
00:12:45
Siddharth: I reinvested back into customer experience and I reinvest a
00:12:48
Siddharth: lot of my money back into, you know, investing in
00:12:51
Siddharth: long term investment vehicles, not looking for quick bucks or
00:12:54
Siddharth: making money fast.
00:12:56
Siddharth: So this cash flow management is very key and of course, very,
00:12:59
Siddharth: very important paying your taxes on time.
00:13:03
Siddharth: So I follow a formula called TWCGO. I have a
00:13:06
Siddharth: tax account, a wealth account, a charity account, a general
00:13:08
Siddharth: account and operations account.
00:13:10
Siddharth: Five different bank accounts. Ok.
00:13:13
Siddharth: My receivable account is my main current account and whatever
00:13:16
Siddharth: money hits that I moved into another sub current account
00:13:19
Siddharth: that I have in my same with my same bank,
00:13:22
Siddharth: 4030 to 40% goes towards that, which is the tax
00:13:25
Siddharth: amount which covers the GST and as well as the
00:13:28
Siddharth: itr the income tax returns
00:13:31
Siddharth: and then whatever is remaining, we use that for uh
00:13:34
Siddharth: a percentage goes to a charity, a percentage goes to
00:13:37
Siddharth: our wealth. We invest into our portfolios and stuff in the,
00:13:41
Siddharth: you know, we have our is going.
00:13:43
Siddharth: and we also have uh an account for general which
00:13:47
Siddharth: is all our household related stuff, rental, the, the children's
00:13:51
Siddharth: school fees, fuel and all of that stuff is covered
00:13:54
Siddharth: mobile bills, food groceries. And then we have an operations
00:13:57
Siddharth: account which is the main current account itself which we
00:13:59
Siddharth: use for other business operations where we cover all the
00:14:01
Siddharth: costs like a cost tool cost, team costs, you know,
00:14:05
Siddharth: event costs and everything else connected to the business.
00:14:08
Siddharth: So this cash flow management has been, we've been doing
00:14:12
Siddharth: this right from day one and that's what has helped
00:14:14
Siddharth: us be very profitable.
00:14:16
Siddharth: Last point number 11 is if you want to know
00:14:19
Siddharth: whether this is profitable or not. You got to be adaptable.
00:14:22
Siddharth: If you're rigid, you're gonna break. If you're flexible, you
00:14:26
Siddharth: will be able to, you know,
00:14:28
Siddharth: journey through whatever storms that may be coming. Ok?
00:14:33
Siddharth: What this is what I learned from Jeff Bezos, the
00:14:35
Siddharth: founder of Amazon,
00:14:37
Siddharth: he says, be fixed on your vision but flexible on
00:14:42
Siddharth: how you get there.
00:14:43
Siddharth: Most people today are rigid on their, you know, they
00:14:47
Siddharth: are very fixed on. I mean, their vision is very
00:14:51
Siddharth: flexible but they are very rigid on their methodologies
00:14:55
Siddharth: and they'll just break over time. So these are the
00:14:58
Siddharth: 11 points. If you found this podcast useful, I would
00:15:00
Siddharth: like you to share which points inspired you the most.
00:15:05
Siddharth: And I would like to also subscribe to this podcast
00:15:06
Siddharth: so that you get more in the future. Catch you
00:15:08
Siddharth: the next episode.
00:15:10
Siddharth: And I've officially completed 29 out of my 90- day
00:15:13
Siddharth: podcasting challenge going on a streak, hoping to complete all
00:15:16
Siddharth: 90 days. And if you're already a part of my community,
00:15:19
Siddharth: take up a challenge like this for yourself. And the
00:15:21
Siddharth: best way you can challenge yourself is to upgrade yourself
00:15:23
Siddharth: to my Diamond certification level, which can help you accelerate
00:15:26
Siddharth: your journey much faster. So there's a link in the
00:15:28
Siddharth: description or you can go to sidz.co/ diamond and see
00:15:33
Siddharth: you in the next showcase, all the best