Emma worked for ACME Accounting as an administrative assistant for 10-years and had maxed out her salary at $25,000 per year. Emma’s salary was barely enough to justify paying for her kid’s daycare while she worked. In order to make some extra money, Emma had a side-job of baking and selling her designer cakes to friends when they had a graduation party, a big birthday bash or a special celebration. She affectionately called her side-business Emma’s Cakes. Just a few months ago, Emma had a great month of selling cakes. She sold $1,500 in cakes that month and had gotten even more orders the following month from friends of friends. Emma thought to herself, “if I could just sell $2,000 per month in cakes, I would be getting paid as much as my day-job; and I’d be able to stay home with my kids and save a ton of money in daycare costs.”
After discussing the situation with her husband Joe, Joe expressed some concern about losing some of the benefits that Emma currently received at ACME Accounting. While Emma’s salary wasn’t great, Joe didn’t have health benefits at his construction job; and Emma’s health insurance was covering their family of four. Joe could see how important Emma’s business was to her and thought, “If she doesn’t make it in the cake business, she can probably find another job.”
Emma was nervous as she readied herself for what would be her last official day at work. At least her last day as an employee. She remembered how excited she had been when she gave her employer the required two-week’s notice. Her boss wished her well and the rest of the employees gave Emma a great going away party. They promised they would be some of her best customers in her new cake business.
Emma Starts Her Business
Emma felt both confident and scared at the same time. What would happen if she couldn’t get enough cake orders? It took so long to get the kids into the right daycare. If this ‘cake thing’ didn’t work out, She’d have to find a new daycare all over again. How would Joe and her pay for health benefits? Emma pushed those fears out of her mind and said to herself, “You got this girl!” Before Emma left her job, she had printed business cards and flyers to advertise her new cake-business. She decided she would attend some local business networking events to get the word out about her new business. She knew that with her concentrated focus on getting business, she could easily double what she had earned making cakes as a side-business.
Emma’s 1st Year
After a year of not working for ACME Accounting, Joe came to Emma with some disturbing news, “You keep telling me your doing well in your cake business, but we are hurting on our finances. We have $10,000 in additional credit card debt; and our savings has lost $5,000. What gives?”
After doing her cake business for a year, Emma realized that being a business owner was quite a bit different than what she had initially thought. She was working harder than ever and felt like she had not made much of an improvement from her past life as an administrative assistant. She thought that if she could sell just a few more cakes, she would be better off than her administrative assistant paycheck at $25k/year. While she did increase her cake sales to $2,000 per month, she was financially worse off than she was before. In the past, she was getting close to $35,000 per year in benefits and compensation from ACME Accounting, plus an additional $5,000 per year from her cake business. She paid $15,000 per year in daycare and thought she would save this money by taking her kids out of daycare. Then, she realized that a 2-yr old and 4-yr old take a lot of time during her day, so she wasn’t able to commit as much time as she had hoped to getting her cake business going. Emma also realized that she paid close to $7,000 in babysitting costs to get someone to watch her kids while she attended networking meetings or met with printers or did other business tasks. With ACME she had a net income of $25,000 per year ($35,000 salary&benefits + $5,000 cake sales – $15,000 = $25,000 per year; and now she was earning a net profit of $5,000 per year in her cake business ($24,000 sales – $12,000 costs – $7,000 baby sitting= $5,000). That seemed impossible! How could she have gotten her cake business so wrong?
Emma responded to Joe with tears in her eyes, “I’m sorry, Joe. I’ve made a terrible mistake. I guess I let my dreams get in the way of common sense. I’ll start looking for work to see if we can get back on track financially.”
Joe felt like he had to console his wife with one more bit of hope, “You know, Hon. My boss hired a business coach and our business is doing much better. In fact, I got a raise just last month because of advice the coach gave my boss. Maybe this coach can help you?”
Emma felt a little encouraged, but then her skepticism got the best of her, “There’s no way I can afford to hire a professional to help me. Do you think we can afford even higher credit card debt? Let’s face it, this cake business was a bad idea.”
Joe reacted, “Hon, I’ll talk to my boss. I think the coach talked with him about his business for free to start. What would it hurt for you to talk with the coach to see what he thinks about your cake business?”
Emma felt like it couldn’t possibly hurt. She was heart-broken that Emma’s Cakes was dying… and thought, if it didn’t cost anything to talk, like Joe said, ‘what could it hurt?’.
Initial Consultation with Coach Russ
Emma called Coach Russ for their initial consultation and just vented. At first Russ asked some questions that got Emma to think more deeply about her cake business than she ever did before. Russ’s questions made Emma feel quite uncomfortable; and yet hopeful at the same time. As Russ asked questions like, “What is your Unique Selling Proposition?” or “Where are you getting customers?” or “How did you set the price for your cakes?”; Emma felt downright stupid she didn’t have good answers to these questions. But, when Russ explained the importance of some of these business principles, Emma realized that there was hope for Emma’s Cakes if she could gain this knowledge.
At the end of their brief and emotional conversation, Emma asked, “How do you work with your clients? and How much do your services cost?”
Before she even did this consultation, she knew this is where her hope would be crushed. She knew that she couldn’t afford to lose more money pursuing this ‘Emma’s Cakes dream’. But she asked anyway.
Russ replied, “Before I share my price with you, it’s first important that you understand how I can benefit you and Emma’s Cakes. Agreed?”
Emma responded, “I suppose. So how can you help me?”
“I can help you increase your leads, increase the conversions of those leads into paying customers, increase your prices and increase your profits to a point where my fee will seem inconsequential.”
Emma felt like she was being sold, “So, what is this ‘inconsequential’ fee you are talking about?”
“I’m not sure you heard what I said. What if I charged you $1-million and promised you that you would receive $2-million in return?”
Emma played along, “I would do that deal all day long. But I’d certainly be skeptical about how you would get me $2-million before I gave you $1-million. Plus the fact that I don’t have $1-million.”
“Fair enough”, commented Russ. “So, here’s the thing. Most new business owners have a lot to learn about business. I’ve tried to gently point out some of the items that you have to learn in this brief consultation call. The problem is that most business owners are not aware they have a lot to learn, and so when I tell them HOW I will help them, they are skeptical that my help will actually result in higher sales, and higher profits. In fact, they have convinced themselves that whatever business they’re in, it’s an impossible task to make decent money.”
Emma interrupted, “Ok. But you’ve got to give me something. My husband and I are hurting financially; and I cannot just keep pouring money into a money pit.”
Russ smiled, “Agreed. So here’s my proposition for you. We will have a 1-hour coaching session weekly. In this session, I will help you conquer one business challenge at a time. Each time you advance in your business thinking, you will be able to improve your earning ability; and you will be able to earn enough to pay my fee. I will charge you $1,000 per month for these weekly sessions.”
Emma was heartbroken. $1,000 per month was greater than her meager profits in Emma’s Cakes. How on earth could she afford to get into more debt? Plus, Russ wasn’t actually DOING anything… he was only giving her more stuff to do; and that stuff may cost even more money.
Tears fell from Emma’s eyes as she responded, “Russ, I think that you can help me, but I just can’t afford $1,000 per month.”
Russ was serious now, “Emma, I know the pain that you’re feeling right now; and you are perfectly justified in your disappointment. But, you also have an opportunity. If you’re serious about Emma’s Cakes; and serious about transitioning from a home-baker into a business-woman, you have to start learning how to INVEST in your business. Investment is not easy, but it’s often fruitful if you do it the right way.”
Emma responded, “Can you guarantee me that I will get the $1,000 per month back in increased profits, if I hire you?”
“I cannot make such guarantees. I can only promise you that if you are not making satisfactory progress, you can fire me at any time. At the same time, I will tell you that most of my clients don’t see positive results for six months. Although they do see positive momentum after their first session. I can also tell you that making positive progress is ultimately up to you. I can help you defeat your emotional blocks and give you wise business advice, but it’s ultimately up to you to do what it takes to be a successful business woman.”
All Emma could think of was that she could dig her family’s financial hole another $6,000 deeper with six months of coaching, by giving Russ a chance to help her. Then she thought, “If I’m not making progress after the first month, I can fire Russ and only be into this ‘business coaching experiment’ for $1,000.
Emma told Russ that she would need to talk it over with her husband before she made such an important decision. Russ told Emma that he’d be glad to answer any questions that Joe had and would call back in a week to see what she had decided.
Emma and Joe decided to give this business coaching thing a try.
1st Coaching Session
Emma was excited to do her first coaching call with Coach Russ until she heard his start to the conversation.
Russ asked, “What would you like to work on today?”
Emma thought, “What a stupid question for the supposed ‘business expert’ to start with!”
After a 5-second pause, Emma said, “I’d like to learn how to double my monthly sales of cakes.” Thinking, “let Russ choke on this one.”
Russ then asked, “What is the best way you can double your monthly cake sales?”
At this, Emma was angry, “I thought you’re the expert! What am I paying you for if you can’t give me advice?”
Russ responded, “I can give you advice; and you’d do okay for a short time by following my advice. However, I find that it is much more beneficial for my client’s long term success, if they exercise their critical thinking skills by creating their own solutions; and we then embellish those solutions with my expertise.”
As their coaching sessions continued, Emma found that she would come up with some brilliant ideas either during or after her calls with Coach Russ. Why did it take paying a coach for her to think about her business the way she did? Sure, Russ offered some wise council on the finer business points, but most of the ideas and the work were Emma’s. Emma supposed that it didn’t matter as long as whatever they were doing helped her succeed as a business woman.
Emma’s Cakes Year 2
It was a typical Tuesday morning. Emma now looked forward to her call with Coach Russ. A year ago, Emma dreaded these calls. She was convinced that Russ would criticize her for some stupid thing she did in her business. Emma soon learned that Russ was quite encouraging and helpful.
Emma’s cakes had increased its sales to $7,000 per month by the end of year two. Emma had increased her prices, changed the way she marketed her cakes and had become an amazing sales woman over the past year. One of the first tasks that she did was create a monthly financial forecast at Russ’s urging and realized that in order to make the kind of money she wanted to make, she would need to do a lot of things differently. It wasn’t easy at first, but with her plan, she knew that her financial future would improve. As promised, Emma didn’t experience immediate success in her cake business after she started coaching, but within a few months, Emma saw her coaching investment paying huge dividends; and she realized she was turning into a professional business woman.
This year, Emma had revised her business plan so that she would be able to sell her cake business in ten years and live quite well off of the proceeds of the sale of Emma’s Cakes. In fact, Joe would be able to retire from his construction job… and possibly start his own contracting business.
Emma was shedding tears once more… but this time they were tears of joy; as she thought about what would have happened if she gave up on Emma’s Cakes only a year earlier.
My name is Jeff Schuster, owner of Jeff Schuster Business Coaching. I help my clients achieve success in their business dreams; If you’re interested in a no-cost initial consultation to see how I can help you, please complete the contact form below or email me directly at email@example.com.
Note from the Author
My name is Jeff Schuster. I am a certified Life and Business Coach serving small business owners, corporate executives and others who want to transition from “expert” to “entrepreneur”. I have been a small business owner for most of my 30-years in the workplace. I grew an energy efficiency and renewable energy engineering and construction company from nothing to over $10-million/year and sold it in 2013. I now help other business owners make amazing progress toward their own dreams of business ownership independence and success.