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Hobby Or Business? How You Can Tell The Difference

Hobby Or Business? This is a question asked by an Australian business owner on an expert platform I'm a member of, and I'd like to share my answer here.

"Is this a hobby or business?" The mentor of the questioner asked them this, saying they should choose a metric that reflects the opportunity cost of the time spent on the startup.

Here's my answer:

A business has a steady revenue stream coming from a predictable flow of customer leads.

A hobby has inconsistent revenue due to an unpredictable flow of prospects.

A business results from systems. The owner can do other things and the business continues to bring in leads.

A hobby usually relies on the efforts of the owner. When the owner stops, the process stops.

hobby or business predictable revenue flock behavior

Hobby Or Business? The Difference To Look For And To Create

I was watching a Bar Rescue episode recently and host Jon Taffer was explaining to the bar owner that this bar needed to generate $1600 an hour for just three key hours over three nights: Thursday, Friday, and Saturday. If it did that, the bar would make the target profit.

That is an example of the system behind a business. Knowing when the key hours of demand are turns the bar into a predictable system of revenue--assuming the customer base is there to support it. Or else the owner has to get marketing into action to reach those targets...but at least he knows what he has to do.

If he didn't, his bar would remain an inconsistent hobby. He'd make money some nights and not others, and not know why or what he had to to do succeed.

That got me thinking about my own business. When do people predictably buy? How can I plan for that, take advantage of that, expand upon that? What "hours" (more like days of the month for my consulting business) do I need to predictably generate $X to make my money target?

Predictable Revenue Is The Difference Between Hobby Or Business

I know most people buy at the beginning or end of the month from me, because that's when their panic alarm really hits as the bills are due ("I need to avoid this"; or, "I can't let that happen again".) But there's also a predictable set of buyers who get ahold of me in the middle of the month, between the 15th to the 20th, say, and I don't know why they do.

I realized I need to look into that, because it's something I can systemize. It can become one of those "3 hour periods on Saturday night" if I make the right use of it; that will turn this kind of buyer from a hobby (as they are inconsistent right now and I don't depend on them for anything except bonus revenue, but I know they're out there) to a systematic, predictable revenue source which is the hallmark of a real business.

See where I'm going with this? Can you answer your own question? I think your mentor is right on in asking and they probably already know the answer. They probably want you to start thinking more about systems on your own initiative. Making some money with an idea is great, but that's just "proof of concept" unless you have made a steady, repeatable, predictable revenue stream out of it.

>> Jason Kanigan is a business strategist and conversion expert. To book a call with Jason to discuss your situation, click here. <<

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Qualify Not Close: Make Selling Easier On You

Qualify Not Close. You see a ton of emphasis on The Close in traditional sales training. Get that prospect in there, and BAM! Hit them over the head with The Close. Kill 'em like a squirrel in a deadfall trap.

Killer, huh?

You want to be a killer?

What if word starts getting around that you're a killer when it comes to sales? That this is the attitude you bring to the sales conversation?

Why You Should Qualify Not Close

It may work for appliances and cars—people stupidly buy vehicles, a long term, large financial investment, as if they're deciding what brand of orange juice they like—but in a real, senior B2B selling situation you're likely to get "niced out the door" by the prospects you're hoping to "kill."

Let me ask you this: What matters more...what you say, or what they say?

If you answered, "What I say," you're in error.

If they say it, it's true. If you say it, you have to defend it.

Even if it was exactly the same thing!

Closing without Qualifying is exhausting.

shouting qualify not close

It's mud wrestling that prospect to the ground and pinning them there...in the mud.

It's getting hit with objections, trying to come up with the memorized rebuttal, and overcome the issue.

It's presenting to those who are not necessarily a fit to even see your offer. And the fast-tiring struggle that comes with that.

So while you may have a book in your hands that promises to teach you The Secrets of Closing, what it's really teaching you is how to get tired out trying to force square pegs into round holes. Can you do it? Sometimes. But man, is it exhausting.

Qualify Not Close To Use Your Energy Well

I don't know about you, but I don't have the energy for that.

I don't have the energy to support the case for what I offer entirely on the force of my personality, or my confidence.

If they say it, it's true. If you say it, you have to defend it.

I'd much rather get the prospect to say it.

I'd much rather get the prospect to tell me exactly why they're a fit for this offer.

I'd much rather get the prospect to close themselves.

And the way to do that is by Qualifying heavily up front.

Before any kind of dog and pony show. Before any attempt at a Close.

Put your effort into Qualifying, and you'll have a much easier time Closing. You'll have a lot more energy left over, too.

Even another well-known sales trainer, who really pushes the Closing thing, says this: Fill your funnel to the point where it's overflowing.

OK, he didn't use such nice language, but that was the point. Fill your funnel so that you have so many leads—you can do what?

Pick and choose.

Select those who are most likely to say, "Yes!" to your offer.

Qualify.

Yep, that's qualifying.

Behind the big bang of The Close, which is what everyone thinks and says they want, is Qualifying...which is what they truly need.

Hmm...give them what they say they want...they said it, so it's true...but sneak in what they really need...I have to admit that's good selling.

>> Jason Kanigan is a sales trainer and business strategist. To book a consultation with Jason to discuss your Qualification issues, click here. <<