Mike Michalowicz's Blog, page 19

February 23, 2023

Does Your Recruiting Strategy Create More Profitability?



Here’s something to check on: Does your recruiting strategy ultimately provide your small business with profitability? 

To get the right talent, you need to ensure that you recruit for the type of team member you want to work with, who will optimize the position and increase revenue. 

It starts with having a clear understanding and commitment to your immutable laws. What are your values, the values of the company, and the values you want reflecting in your new hire? What are your must haves?

The other day we saw a job posting for a company we love, and were surprised to see that their job description had points that are in direct conflict with what the company stands for. I can only assume that a third-party recruiter created the description, and I do hope they end up finding someone who aligns with their core values.

When we create job descriptions we tend to add the tasks and responsibilities, but what I found is that if you have someone with the right attitude, a lot of the necessary skills can be taught. It’s harder to teach someone to have a whole new perspective. 

Hiring the right people will increase profit in your small business because:

Increased profitability: When a small business recruits and hires the right employees, they are more likely to be productive and efficient at their work – which generates more revenue and reduces costs, leading to more profit.

Innovation and growth: Recruiting employees with diverse skills and backgrounds can bring fresh ideas and perspectives to a small business. This can lead to the kind of innovation and growth that creates more revenue.

Reduced turnover: High employee turnover is costly for a small business. The process of recruiting, hiring and training new employees takes up a ton of resources. Hiring the right people creates more longevity – and loyalty.

Bonus: The right fit = happy team members = better customer and client service (= more money, people!).

Remember to treat your recruiting with care!

Wishing you good health and wealth!

-Mike

PS – Peer support has been an essential aspect of my entrepreneurship journey, so I created a mastermind group so you can benefit too. I’m hosting a One Day Mastermind this spring. Learn more here and make your own journey easier!

PSS – Have you taken a five minute break and watched The Reel Entrepreneur? Watch this fun take on business perspectives here!

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Published on February 23, 2023 09:59

February 16, 2023

Five Steps to Start Implementing Profit First in Your Small Business

Have you ever bought a book with the intention of reading it? How about knowing the book had a system to transform an aspect of your life and it’s sitting on one of your shelves?

You see where I’m headed, right?

I get a lot of emails and questions when I’m on the road about Profit First. The most common question I get asked about Profit First is how to get started.  Here is a list of five steps to get started with the Profit First system:

Read the book: Profit First provides detailed information on how to implement the system.Determine your target allocation percentages: Use the percentages recommended in the book as a starting point, but adjust them as necessary to better fit your business.Open separate bank accounts: Open a separate bank account for each of the categories identified in step 2.Implement the system: Begin allocating funds to each account based on the target allocation percentages. The author suggests doing this on a regular basis, such as twice a month.Monitor and adjust: Continuously monitor your accounts to ensure that you are staying on track with your target allocation percentages. Adjust the percentages as necessary to better meet your business needs.

I am wishing you health and wealth always.

-Mike

Need more guidance? Contact us or check out these free resources.If you’re tossing around the idea of giving keynote speeches to scale your business and position you as an industry expert, or even if you’re a seasoned speaker, consider joining John Bates and I on May 10-12th in Salt Lake City.  Click here to learn more now.We entrepreneurs need to stick together! I have created courses, workshops and mastermind groups to leverage the knowledge of entrepreneurs and share information to help you make the most impact in your small business. Check them out here.

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Published on February 16, 2023 10:00

February 15, 2023

The Importance of Supporting Black-Owned Businesses – And a Few to Watch

February is Black History Month, and I wanted to take some time to highlight why supporting Black-owned businesses is so important. Recognizing and supporting black small businesses is an actionable step toward building a more equitable and thriving economy and promoting social justice through:

Economic Empowerment: Small businesses, including those owned by black entrepreneurs, are the backbone of the economy. When we support these businesses, we help to create jobs and economic growth in our communities. By recognizing and supporting black-owned small businesses, we can help to close the racial wealth gap and promote economic empowerment for marginalized communities.Diversity and Representation: Black small business owners are an important part of the business community, and their perspectives and experiences are valuable. By recognizing their contributions and promoting their businesses, we can help to create a more diverse and representative business landscape.Social Justice: Black-owned businesses have historically faced discrimination and barriers to success, including limited access to capital and resources. By supporting black small businesses, we can help to level the playing field and promote social justice.Cultural Preservation: Black small businesses often reflect and celebrate the culture and history of black communities. By supporting these businesses, we can help to preserve and promote the unique cultural heritage of these communities.

There are many successful and inspiring black entrepreneurs who are making significant contributions to various industries. Here are just a few of them:

Tristan Walker – He is the founder and CEO of Walker & Company, which creates health and beauty products for people of color. He is also the founder of CODE2040, a nonprofit organization that aims to increase diversity in the tech industry.Kisha Mays – She is the founder and CEO of Just Fearless, a global business consulting firm that helps companies expand into new markets. She has worked with a variety of high-profile clients, including Coca-Cola, Delta Airlines, and Mercedes-Benz. You can heat her interview with Beyond 8 Figures here, and get her best for an entrepreneur who wants to build a $10M buisness.Rodney Williams – He is the founder and CEO of LISNR, a technology company that uses ultrasonic audio technology to connect devices. LISNR has received funding from major investors like Intel and Visa.Chris Bennett – He is the co-founder and CEO of Wonderschool, a platform that helps parents find and book affordable and high-quality childcare. Bennett was named to Forbes’ “30 Under 30” list in 2018. You may watch one of his TED talks here.Melinda Emerson – I would be remiss not to include someone I admire, Melinda Emerson. We have a lot in common in that we have the same mission – to help small businesses thrive. But, Melinda is known as the “SmallBizLady”and is America’s #1 Small Business Expert. She is an internationally renowned author, keynote speaker on small business development, social selling, and online marketing strategy.

These are just a few examples of black entrepreneurs who are making waves in their industries. There are many more out there, and it’s worth keeping an eye on the new and exciting businesses they’re building.

Let this month act as a reminder to contribute to the economy by supporting Black-owned businesses. Do you have a favorite Black entrepreneur or Black-owned business? Tell me in the comments!

Here’s to supporting our fellow entrepreneurs everywhere!

Wishing you health and wealth.

-Mike

 

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Published on February 15, 2023 09:05

February 13, 2023

One Step to Become a TED Talk Expert

Did you know that giving a speech is one of the best strategies to scale your small business? 

Keynote speeches can provide small business owners and entrepreneurs with a powerful platform for sharing their ideas, establishing thought leadership and raising brand awareness. You’ll network, share best practices, and boost morale, which can help your business succeed in the long term. Giving a TED talk or keynote is perfect for:

Establishing thought leadership: Keynote speeches help small business owners establish themselves as experts and thought leaders in their industry. By sharing your experiences, insights, and ideas, you’ll demonstrate your knowledge and expertise, which builds credibility and trust with your audience.Networking opportunities: Keynote speeches provide you with an opportunity to network with other business owners, investors, and potential customers. You can use these opportunities to make new connections and build relationships that scale business.Raising brand awareness: Raise awareness of your brand and reach a wider audience by speaking at conferences, events, and other public forums. You’ll reach people who may not have heard of your business before and generate new leads and customers.Sharing best practices: Giving a speech is the perfect way to share best practices and lessons learned from your experiences. You’ll help others in the industry learn from your successes and failures and avoid common mistakes.Boosting morale and motivation: This is your chance to boost morale and motivation among employees and stakeholders. By sharing your vision and goals, you can inspire and motivate your team to work towards a common goal.

Now before you go racing to the stage, here are a few tips to follow:

Brevity and clarity: Keep it short and sweet. TED talks are limited to 18 minutes or less, which forces speakers to distill their ideas into concise, clear, and accessible messages. This makes it easier for the audience to understand and remember the main points.Diverse topics: Keep it interesting. TED talks cover a wide range of topics, from science and technology to art and design, and everything in between. This diversity of subjects attracts a diverse audience and makes the talks appealing to a broad range of people.Inspiring content: Avoid the zzzzzz’s. Your keynotes and TED talks should be designed to inspire and motivate. They should feature stories of personal transformation, innovation, and creativity in order to have a profound impact on the audience and help spark new ideas and perspectives.

If you want some examples of my keynotes, you can watch them here. These speeches have been one of the most rewarding experiences of my life, and it’s such an honor to be able to serve in this forum.

Wishing you health and wealth always.

-Mike

If you’re entertaining the idea of giving keynote speeches, or even if you’re a seasoned speaker, consider joining John Bates and I to learn how to give the best darn speech ever and increase your revenue.  Click here to learn more now.Check out a behind-the-scenes chat in this video from John and me…We as entrepreneurs need to stick together! I have created courses, workshops and mastermind groups to leverage the knowledge of entrepreneurs and share information to help you make the most impact in your small business. Check them out here.

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Published on February 13, 2023 06:18

February 9, 2023

Taxes and Profit First – Tips About Taxes From a Profit First Professional

Taxes can be intimidating and overwhelming for business owners – but they don’t have to be. As an entrepreneur, you need to understand the different types of taxes and how to deal with them.

First, you need to differentiate the types of taxes that may affect your business. Depending on the type of business you own, you may be subject to income taxes, payroll taxes, self-employment taxes, or other taxes. You’ll also need to know how to file your taxes and when you’re required to make payments.

Once you know the types of taxes you’re required to pay, you need to figure out how to pay them. You may be able to pay them online, by mail, or in person. You should also look into tax deductions that can help reduce your tax bill. Business expenses, such as office supplies and travel expenses, may be deductible.

Finally, you need to know how to stay on top of your taxes. This means setting up a system for tracking income and expenses, making sure you file your taxes on time and paying taxes when they’re due. If you’re not sure about any aspect of taxes, you should consult a professional.

We asked Profit First Lead Billie Anne Grigg, what key points we should emphasize around taxes. Here’s what she wants you to know.

Paying taxes is actually a GOOD thing. It is proof that your business is profitable. Paying taxes is only problematic if you don’t have the cash on hand to pay them. That’s where Profit First comes in. The Profit First system helps you proactively set aside money to pay your taxes, so you don’t have to dread tax day anymore.Profit First recommends setting aside 15% of your Real Revenue (Total Revenue minus Materials and Subcontractors costs) for taxes. If your tax professional is not a Profit First Professional, they might tell you 15% isn’t enough. Why? Because your tax professional is looking at the “bottom line” on your Profit and Loss statement, or your “profit on paper” after all business expenses have been deducted. But you probably don’t run your business based on your Profit and Loss statement. Because the Profit First system deals with real cash money as it is received, you can set aside a smaller percentage than your tax professional recommends and still have enough money to pay your tax liability.Following Profit First and creating a tax account does NOT negate the need to work with a tax professional. A qualified tax professional can help you legally reduce your tax liability with strategies that allow most of your cash to stay with your business (or flow through to you, the business owner.) Beware of tax professionals whose primary strategy is running up expenses to avoid paying taxes. (This can be another good place to plug working with a PFP.)Keep in mind that you and your tax professional speak two dialects of the same language. When you say Profit, you mean cash in the bank. Your tax professional means the bottom line on your Profit and Loss statement. When you say Owner’s Pay, you mean the money you have set aside in your Owner’s Comp account. Your tax professional means wages paid to you through payroll; they look at your distributions differently. When you say OpEx, you mean all the money you’ve paid out of your business, including items that end up on your Balance Sheet. Your tax professional means only tax-deductible expenses on your P&L. You can overcome these dialectical differences by working with a Profit First Professional tax professional.

Taxes don’t have to be overwhelming. With the right knowledge and organization, you can make sure you’re paying the right amount of taxes and staying on top of them throughout the year.

Wishing you good health and wealth always.

-Mike

PS – For more tax guidance and free, downloadable resources to help you ensure the health of your business, CLICK HERE. PSST! – The Profit First Instant Assessment has a tax section!

PSS – For more tax guidance and free, downloadable resources to help you ensure the health of your business, CLICK HERE. PSST! – The Profit First Instant Assessment has a tax section!

Wait! One more thing! Are the kids in your life financially literate? Start by reading My Money Bunnies with the younger kiddos. There are free downloadable resources for them here. For kids a little older, download the Profit First For Kids Chore List. Start them young!

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Published on February 09, 2023 09:37

February 8, 2023

Don’t Hide From Your Business Taxes – Four Ways to Plan Ahead and Not Come Up Short

As a small business owner and entrepreneur, planning for taxes may not be in the forefront of your mind. 

Until tax season is upon you.

A couple of years ago, Kelsey and I sat down to chat about business taxes. I gave my expert guidance here.

Getting your tax liability under control requires planning and discipline, and it’s impossible to overestimate the importance of handling it properly. I’ve seen more than one business go under because they didn’t prepare for tax season and can’t pay their taxes. While there are nearly always other problems in those businesses as well, a massive, unexpected tax bill can throw any entrepreneur for a loop – unless you’ve planned ahead. The problem is that bank balance accounting – if your tax money is included in your bank account – isn’t realistic.  

You must find a way to separate out the money that you’re going to owe Uncle Sam. Here’s my solution:

I call my plan the Thanksgiving dinner approach. Work with me here: on Turkey Day, we don’t eat off the tray that holds the entire turkey. We don’t shovel in mouthfuls straight from the casserole dish of your mother’s sweet potato recipe. We allocate turkey from the serving platter to individual plates. If you think of your revenue as the turkey, you need to allocate that revenue to different accounts that serve different functions.

1. Create a separate account for your taxes.  

Every time (and I mean every time) you make a deposit into your regular business account, deposit 15% of the total into your tax account.  Now most of us pay a higher tax rate than 15%, but after you deduct your expenses, 15% of your gross revenue should cover your liability. If you want a more accurate figure, a short conversation with your accountant can give you an idea of the percentage of your income that you should set aside for taxes. It’s impossible to overestimate the importance of physically setting aside your tax money.

2. Call the account “The Government’s Money.”  

This concrete reminder that one of your roles as an entrepreneur is being an agent for the government helps you keep your hands off the money that you’re going to owe in taxes. You’ll be much less likely to “borrow” from your tax account if it’s labeled as not yours.  The whole point of setting the money aside ahead of time is that it keeps you from spending it and having to scramble to cover the tax bill.

3. Realize that income tax is a little like sales tax.  

Okay, we all know that sales and income taxes are different, but it can help with your perspective if you think of the 15% of your revenue that you’re setting aside as a tax on all the sales you make. Separating your “sales tax” out from the very beginning means that you won’t fall short when it’s time to pay the government piper, and it forces you to look at your business’ financial picture more realistically.

4. We all have to pay for our sins.  

Don’t make assumptions here – you’ll never catch me saying that earning money is a sin. Far from it. What I mean is that for businesses that are currently using their revenue to pay off debts, it may feel like a double whammy to set aside 15% of the money that you’re using to cover expenses. It can feel like the money that’s coming in isn’t really income if it’s all going back out, but it is, and you will owe taxes on that income. If you try to find a way around setting aside the full 15%, you’ll get caught short, and the IRS will get their share, one way or another. If you consider nothing else sacred, you must respect the power of the government to get what they’re owed.

This whole approach to handling your taxes so that you’re not hit with an unexpected bill that you can’t afford to pay fits into the larger accounting philosophy of Profit First. It’s a simple, yet fundamental shift in thinking about the financial health and priorities of your businesses, and it guides us to build wealth consistently and responsibly. Making sure that you can afford to pay your taxes is essential to the success of your business and frees you up to focus on the important task of growing your company.

Wishing you health and wealth.

-Mike

PS – Be sure to watch the full video of Mike and Kelsey talking taxes HERE.

PSS – For more tax guidance and free, downloadable resources to help you ensure the health of your business, CLICK HERE. PSST! – The Profit First Instant Assessment has a tax section!

Wait! One more thing! Are the kids in your life financially literate? Start by reading My Money Bunnies with the younger kiddos. There are free downloadable resources for them here. For kids a little older, download the Profit First For Kids Chore List. Start them young!

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Published on February 08, 2023 06:00

Your Business Taxes – Four Ways to Plan Ahead and Not Come Up Short

As a small business owner and entrepreneur, planning for taxes may not be in the forefront of your mind. 

Until tax season is upon you.

A couple of years ago, Kelsey and I sat down to chat about business taxes. I gave my expert guidance here.

Getting your tax liability under control requires planning and discipline, and it’s impossible to overestimate the importance of handling it properly. I’ve seen more than one business go under because they didn’t prepare for tax season and can’t pay their taxes. While there are nearly always other problems in those businesses as well, a massive, unexpected tax bill can throw any entrepreneur for a loop – unless you’ve planned ahead. The problem is that bank balance accounting – if your tax money is included in your bank account – isn’t realistic.  

You must find a way to separate out the money that you’re going to owe Uncle Sam. Here’s my solution:

I call my plan the Thanksgiving dinner approach. Work with me here: on Turkey Day, we don’t eat off the tray that holds the entire turkey. We don’t shovel in mouthfuls straight from the casserole dish of your mother’s sweet potato recipe. We allocate turkey from the serving platter to individual plates. If you think of your revenue as the turkey, you need to allocate that revenue to different accounts that serve different functions.

1. Create a separate account for your taxes.  

Every time (and I mean every time) you make a deposit into your regular business account, deposit 15% of the total into your tax account.  Now most of us pay a higher tax rate than 15%, but after you deduct your expenses, 15% of your gross revenue should cover your liability. If you want a more accurate figure, a short conversation with your accountant can give you an idea of the percentage of your income that you should set aside for taxes. It’s impossible to overestimate the importance of physically setting aside your tax money.

2. Call the account “The Government’s Money.”  

This concrete reminder that one of your roles as an entrepreneur is being an agent for the government helps you keep your hands off the money that you’re going to owe in taxes. You’ll be much less likely to “borrow” from your tax account if it’s labeled as not yours.  The whole point of setting the money aside ahead of time is that it keeps you from spending it and having to scramble to cover the tax bill.

3. Realize that income tax is a little like sales tax.  

Okay, we all know that sales and income taxes are different, but it can help with your perspective if you think of the 15% of your revenue that you’re setting aside as a tax on all the sales you make. Separating your “sales tax” out from the very beginning means that you won’t fall short when it’s time to pay the government piper, and it forces you to look at your business’ financial picture more realistically.

4. We all have to pay for our sins.  

Don’t make assumptions here – you’ll never catch me saying that earning money is a sin. Far from it. What I mean is that for businesses that are currently using their revenue to pay off debts, it may feel like a double whammy to set aside 15% of the money that you’re using to cover expenses. It can feel like the money that’s coming in isn’t really income if it’s all going back out, but it is, and you will owe taxes on that income. If you try to find a way around setting aside the full 15%, you’ll get caught short, and the IRS will get their share, one way or another. If you consider nothing else sacred, you must respect the power of the government to get what they’re owed.

This whole approach to handling your taxes so that you’re not hit with an unexpected bill that you can’t afford to pay fits into the larger accounting philosophy of Profit First. It’s a simple, yet fundamental shift in thinking about the financial health and priorities of your businesses, and it guides us to build wealth consistently and responsibly. Making sure that you can afford to pay your taxes is essential to the success of your business and frees you up to focus on the important task of growing your company.

Wishing you health and wealth.

-Mike

PS – Be sure to watch the full video of Mike and Kelsey talking taxes HERE.

PSS – For more tax guidance and free, downloadable resources to help you ensure the health of your business, CLICK HERE. PSST! – The Profit First Instant Assessment has a tax section!

Wait! One more thing! Are the kids in your life financially literate? Start by reading My Money Bunnies with the younger kiddos. There are free downloadable resources for them here. For kids a little older, download the Profit First For Kids Chore List. Start them young!

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Published on February 08, 2023 06:00

January 27, 2023

Why Does a Healthy Social Life Improve Your Business?

It’s science. There’s a connection between your social life and quality of life. In this article from Psychology Today, it’s explained how our brain reacts positively to communication and the lifelong effects. I wish I had read this twenty years ago.

Here’s a little story. Once upon a time, I was a workaholic. I’m not puffing out my chest here. It was difficult and often dark. I thought the more I hustled, the better business owner, and man, I was. I mean, a hard worker is respected within our societal expectations, and I was delivering the goods.

The thing is, I was missing out on a vital aspect of, well, my own vitality. Mainly, I was missing out on how important my presence was in my family and friends’ lives. At the same time, I didn’t realize how much better I would feel and operate mentally and emotionally by simply connecting with loved ones. 

There was a day years back that I just barely made it to my son’s track meet. I had missed a bunch of them. I knew it was disappointing for my family, but hey, I was working – an honorable excuse. But it was an excuse all the same. That fateful day when I arrived at my son’s meet, I saw the look on his face. His smile glowed. His confidence? Shot straight up. This was the major ah ha moment for me. And since that day, I have prioritized my relationships as much as my business. 

This topic deserves deeper research and understanding, but as a friendly reminder and baseline, studies show that people with a healthy social life live fuller lives longer. As you’re building your business, or working out, or doing all of the things we’re programmed to believe are expected of successful people, know that attention to your social life isn’t slacking, it’s mental health maintenance, a vital part of your health and longevity.

When you aren’t taking care of yourself as a person, you as a business owner can’t operate at full capacity. When your personal needs are met, that makes you more whole and resolute, which allows you to operate better in all facets of your life. 

And the love and support in your life’s journey? Priceless.

Wishing you health and wealth.

-Mike

PS – Peer support has been an essential aspect of my entrepreneurship journey, so I created a mastermind group so you can benefit too. I’m hosting a One Day Mastermind this spring. Learn more here and make your own journey easier!

PSS – Have you taken a five minute break and watched The Reel Entrepreneur? Watch this fun take on business perspectives here!

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Published on January 27, 2023 07:54

January 26, 2023

Build Your Brand to Scale Your Business



Your company needs to stand out and be recognizable in the sea of competition in your industry. With all of the marketing messages being flung our way, we have become a society who reverts to visual messages. One thing you can consider is to refresh your business by updating your marketing strategies, starting with your brand.

You don’t have to reinvent the wheel to update your brand. For example, we’re making updates to our marketing by creating new style and branding guides for my business. This guide will keep our marketing cohesive, reestablish our mission, and represent our company culture.

5 ways to update your brand:

Update your logo – Did you create your logo when you began your business? Does your logo still represent your brand? Does it look tired. Does it even catch your eye anymore? It’s a quick fix. You can use similar colors, change the design, or tagline.Update your business resources – For each book, mastermind, webinar, you name it, I have some kind of worksheet, chart or graph. Let’s face it, if you’ve watched me present on Zoom, you’ve seen my chicken scratch on a legal pad. Any resources like this are getting a face lift. Having visually streamlined resources make them more user friendly.Marketing and branding style guides – You likely keep certain colors and fonts on your site and materials, but you can get tired of looking at the same old thing. You want those visuals to pop and attract, not make people roll their eyes. To keep it cohesive, make sure you have a singular place to refer to, like a style guide for images and graphics.What’s your tagline? Like your logo, you probably created your tagline when you started your business. You don’t have to pivot your mission (unless you want to), but dig deeper to see if you can improve the language in your tagline to immediately let your prospects know what you’re offering.Consistency is key – Be in social media, your website or your marketing materials, make sure that all of your branding matches. Sounds simple, but it’s easy to veer off the path. When your brand is consistent, you keep your audience engaged, rather than distracted by inconsistent visuals.

Your brand is your company’s first impression, so make sure it portrays your business accurately.

Wishing you massive success this year.
-Mike

For the best marketing strategies, Get Different here.

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Published on January 26, 2023 09:48

January 24, 2023

A Little Entrepreneur Inspiration

 



Have you ever had one of those moments when you stop and realize how far you’ve come in your small business? I’d like to prescribe that you do that often!

When you encounter challenges, remember, you’re an entrepreneur. You got here because you’re innovative and can figure things out. It’s so easy to focus on a struggle, but progress can be a little bumpy at times. 

What do I do when I’m facing business challenges? (No spiraling!)

Take pause. Think for a minute about where you started and all that you’ve achieved. Check out the quick video and take a pause with me while you pat yourself on the back of yours!Meet ups and mastermind sessions. I belong to a few mastermind groups of authors and small business owners. During these meetings I remember how isolating it can be as a small business owner. That alone makes the mastermind groups invaluable. The opportunity to hear about what my peers are experiencing is validating, and we work in the small group to develop strategies for each of our unique challenges.Hit the reset button. Take a quick walk, listen to music, get outside, call a friend, meditate. Even if you’re busy, you’ll be able to approach things with a refreshed view if you take a beat.

The small business owner and entrepreneur journey is not for the faint of heart. But you’ve got this. I know you do!

Wishing you good health and wealth!

-Mike

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Published on January 24, 2023 07:48