[00:00:00] Fiona Johnston
We've made a lot of progress as a society in many of the areas that we needed to in the last few hundred years. But one thing that has not changed enough is money. If we want to be able to tip the scales towards the favor of marginalized people, we need to understand the secrets to making money in small business.
The more we talk about money and the secret that usually stay at the golf club, the more likely we are to be able to make money. My mission is to get more money into the hands of good people, specifically good business people like you. This is Money Secrets. The place to learn about the money secrets of successful small business owners.
Because I believe small business can change the world. And in order to do that, we need to be making a lot of money. Let's go.
[00:00:51]
This podcast episode was recorded on the lands of the Wurundjeri people of the Kulin nation. And I'd like to acknowledge them as the traditional owners and custodians of this land and water that I live. Work and play on. I'd like to pay respects to elders both past and present. And note that sovereignty has never been seeded.
This always was and always will be. Aboriginal and Torres Strait Islander land.
[00:01:26]
Hi there. It's Fi Johnston here from Money Secrets, the Podcast. Now, a little while ago, I did something that I've never done before. I created a documentary. I invited eight of my clients to a gorgeous Airbnb in Seddon, Melbourne, and I asked them some really spicy questions about money.
We turned that into a mini documentary called Lifting the Curtain. I had so much feedback about that documentary from small business owners, especially female small business owners. I thought that this would be the perfect place to kick off the Money Secrets podcast. In today's episode, you are going to meet the amazing Kate Forsyth.
[00:02:02] Kate
Hi, I'm Kate Forsyth and my business is called Good Day Club. It's been around for 10 years and it has historically been an events business. Vintage Furniture, High Art, Event Design and Styling, and then I've done some interior design in the last few years, and that's where I'm moving towards creating a business around bold, colourful, personalised interiors for people who want something that really suits them.
[00:02:26] Fi
Kate has worked with some of the most incredible event venues, and spaces in Melbourne and surrounds. Kate and I started working together nearly 10 years ago. I think we are now very happily friends as well. We managed to jump the divide from client to friend. I absolutely love spending time with Kate.
She is hilarious. She's one of the best writers I've ever met. And yeah, she's just got such a witty and funny way of thinking about money that really comes across in this episode. I hope you really enjoy listening to Kate's take on how she sees money in her business and how that has changed over the 10 years that she's been a business owner.
I'm thrilled you're here.
[00:03:32] Fi
Have you felt judged, silly or ashamed about money?
[00:03:39] Kate
Um, I feel like I've probably felt all those things at times. I feel like I've made decisions that felt considered and sensible at the time and then later on it hasn't worked out and then I've felt really silly and I suppose most of the judgement probably comes from myself.
And yeah, there can be some shame around that when you start to feel, you know, something that you've done is silly. silly and it hasn't worked out and you know, you should have done it differently and you know, kind of putting that hindsight lens on things and look, it is, it's hard when things don't work out the way that you expected, but I think not kind of letting yourself go down that kind of, you know, quite steep decline. I definitely have felt judged particularly early on. Um, I had a loan broker say, why would you leave your corporate job for this? And I remember being outraged. So outraged and then I was talking to somebody and they were like, oh those people don't get it They're wage people and look the the revenue for the business at that time was I don't know I think we made sixty five thousand dollars in that year.That was the second year So it would I guess seem silly on paper But I it was a good example of really not giving a fuck what some old guy says to me It's kind of been a bit of a driver to.
[00:04:32] Fi
are you comfortable with money?
[00:04:37] Kate
I'd say for the most part that I am, but it has taken work. It was not something that I grew up feeling comfortable with in my family of origin and it did take me a while.
The main thing has been working with you Fiona and getting some real structure, well some simple structure. around, you know, the various things that make a business work in regards to money. It's starting to feel like it's a normal topic. Feeling like you spend as much time on this stuff as you do other stuff, like marketing or sales and that sort of thing.
So, not kind of, it being that kind of crappy task that you do at the end of the month, because you have to. And the big thing has been getting help. That's how I've gotten comfortable with it. Having people who understand it and are comfortable with it. Breaking it down. Like, you know, you started giving us some really big revenue numbers.
And I was like, how would we do this? Seems impossible. And you were, you just broke it down. And that's kind of a thing that I've taken forward. And even though I've, you know, I'm changing my business and moving in a slightly different direction, that's exactly how I'll do it in the future. And I don't feel uncomfortable or worried about money.
There's not as much coming in right now whilst I transition it, but I feel totally confident that I've got the skills and also the people around me to make it work from a money perspective.
[00:05:36] Fi
What is the biggest lie that you were told about money?
[00:05:40] Kate
I don't know. I think it's probably more of a belief that it's, it's hard.
It's just a really hard thing and it will always be hard and it's very scary and that's very hard to save. I think. That it absolutely can be and it is all those things, but anything is scary if you don't know anything about it. If you are, if you keep yourself in the dark about anything, like, oh, I don't know, should I learn to drive?
Oh, you know, maybe I'll have a crash or it's expensive to own a car, like whatever, like whatever the things. It is scary. Everything can be scary. So it's about like kind of arming yourself and then also I guess letting go of the things that you've been told.
[00:06:08] Fi
How much money did you expect to make in the first three years?
[00:06:10] Kate
Well, I did a very cute little spreadsheet before we started the business, and it was like, just a really basic projection. And my sister was studying at the time, and she was doing like a fashion business course, and she was like, this is what they got us to do. And I was like, oh, I should probably do that too.
And so it was like incredibly rudimentary, but at the time, like, I felt like a boss. lot of work and like a big deal to do it. And from that little projection, I realised that I couldn't charge 10 per chair. Um, I needed to charge 12. 50. So even then that was a very, it was kind of like not a very big thing, but it was an understanding that like when you do the work, even a small amount that it gives you information about where you're going.
This was obviously before I started. And so that kind of, it helped me to realize that you can't just sort of price anything at anything and hope for the best. And so I think I wouldn't know the exact numbers, but it probably was. Less than 200, 000 in the first three years, but I feel like from year two to year three, it was like a massive jump.
The little spreadsheet said that we would get 21, 10 events at this size and whatever. So however I projected it. Um, so it was a lot more than I expected and it kept on getting bigger quickly, but yeah, I kind of sometimes go and have a look at that little spreadsheet. Maybe it was a break even analysis, something like that anyway.
Um, so yeah, I had no idea. And yeah, I mean, a lot of those things I think are really like very quaint. In a way when I, you know, 10 years ago, like looking back 10 years, but I actually think all those little things are incredibly important because you're just building a base and then you keep on building on that and you get more confident doing these different things.
You realise that all these different things give you information. They help you with your direction. And so yes, maybe that little quaint spreadsheet would seem silly now. It's not going to be something I do for the next kind of part of my business journey, but these are all things that sort of help us take those next steps and on our journey.
[00:07:44] Fi
What is the best advice that you have been given about money?
[00:07:49] Kate
I think it's, uh, it's two things. Um, one of them was to not sweat the small amounts. This is from Fiona. Both of these things are from Fiona. You helped us. with decision making around money. So it was have a look at what it is you're trying to decide on.
If it's a very small amount and you can afford it, just do it. Don't spend all your energy going back and forth, back and forth, back and forth. And the other thing which is probably comes before that was about, is it revenue generating or not? So it was like a really, it was kind of like, Oh, okay, yeah. No, it's not revenue generating to by a speaker for the office, but music helps me be really motivated.
And it's a small amount. And that was actually like in the early days, one of the things that we went back and forth on would have. Finance meetings and be like, what's the, what's on the, on the, to buy list or the to invest in list? And he just kept on re litigating this goddamn. I couldn't believe how expensive speakers were.
Obviously we had different ideas about the value, I suppose. But, yeah, I think it was really around the decision making around money decisions. The decision making around money decisions. Um, and how to do that in a simple way that doesn't suck the life out of you and drain you so that you can't run your business because you've spent all your time deciding what to do with your money.
[00:08:47] Fi
How does it feel to ask for money from a client?
[00:068:51] Kate
It feels okay these days. It used to feel like I'd rather do almost anything, but getting that inherent idea that what you do is valuable, what you provide, no one else can provide, and just keeping it the same as anything, any other communication. So it's part of a series of things that happen in an interaction with a customer or a client.
It's just one part of it. And I used to get into it with people. People would be like, Oh, that's too expensive or whatever. And then I'd give this long rundown about why it costs money to deliver furniture to you. And do you know what it costs to have a truck on the road? And now I'm like, okay, well, look, we put our prices up and that sort of stopped anyway.
But I stand by my decisions with people and I didn't, wouldn't really get into it. I'd be like, this is what it costs. This is what is agreed. And also, you know, a service business where we quote and that sort of thing has, you know, kind of makes it, um, it's not really big surprises. I suppose. But I suppose that's all like background stuff in terms of how you feel about something. Like you can rationally say, Oh, it's no big deal. It's just part of the process. But actually believing that too, that what I do is valuable. This is not a ridiculous price.
[00:09:44] Fi
I love how Kate talks about the fact that you can't just pick some random number as your price and hope for the best. I love how she talks about her Queen's Little Spreadsheet, which I'm sure was amazing, by the way, where it really helped her to understand.
Stand that she actually needed to charge a higher amount for her initial pricing in order to be able to reach her goals. Kate talked about the fact that at one point I did throw some pretty big revenue targets at her, and at first it might seem like wow, that. how the hell are we going to get there? But what can be so powerful when you are thinking about a revenue goal for your business is to break it down.
When you can understand how you're going to reach that goal, it just gives you so much more power. When you understand how many events you need to book, or how many haircuts you need to do in a week, or how many retainer clients you need to have in your business. It means that you can focus on that number, rather than the revenue number.
So a little money secret that I have for you is that if you are wanting to set a big revenue goal in your business that you actually hit. Or achieve the best thing that you can do is break that revenue number down so that you understand exactly how you're going to make it.
[00:11:08] Fi
Thank you so much for listening right up to the end.
I hope you enjoyed this episode of money secrets, where we talk about the money secrets of successful small business owners. If you enjoyed the episode, I'd love it. If you subscribe to the podcast, but leave us a review or share this episode with one of your friends. I hope you learned something, I hope you got a new perspective, and I really hope you enjoyed the listening experience.
