How can I make my video business more profitable?
Feb 18, 2023
Introduction
It's all well and good winning work as a video production company, or a video freelancer. But how can we make sure that our video business is full of profit?
And how can you be certain that come month-end, you've not only covered all the bills, but you're actually putting some money aside to invest in you, your business, into kit, or your family?
Well, that is exactly what we're going to cover in today's Q&A. How can I make my video business more profitable?
Links
Transcript
00:00:00:02 - 00:00:18:09
It's all well and good winning work as a video production company, or a video freelancer. But how can we make sure that our video business is full of profit? And how can you be certain that come month-end, you've not only covered all the bills, but you're actually putting some money aside to invest in you, your business, into kit, or your family?
00:00:18:17 - 00:00:41:15
Well, that is exactly what we're going to cover in today's Q&A. How can I make my video business more profitable? Quick bit of context as to why this is so important. As you may know, I started my first production company from scratch and built it to being valued at over $20 million. We were working with brands such as Adidas, Nike and Yves Saint Laurent.
00:00:41:15 - 00:01:09:14
We had 33 full time members of staff and hundreds of freelancers working on projects around the world at any given time. Then in 2018, I lost it. We filed for bankruptcy. Hmm. Don't worry. I took time out to review everything and build back stronger, which I talk more about in other videos. But I wanted to give you context as to why the answer to this question is so important, and how I came to develop what I'm going to share with you today.
00:01:09:17 - 00:01:31:08
Because what we're going to do here today is an exercise that will allow you to identify profitable projects, clients, industries, and then we'll talk about how we use that information to shape our marketing to ensure that you are only attracting the most profitable type of projects and opportunities into your video business. There are many other ways to make your video business more profitable.
00:01:31:08 - 00:01:54:10
Time tracking, bulk buying, increasing your prices. But none of them have as big of an impact as what we're going to talk about today. So when I lost my first production business, I took time out to reflect and get over the embarrassment of it all. I remember sitting in my office at home thinking about the 2,500 plus projects that we had won and delivered over that period.
00:01:54:11 - 00:02:11:09
Some of the projects I loved and some of them I hated. But one of the reasons I had accumulated so much stress was that some of the projects that we worked on, many in fact, cost us more money to deliver than we were paid. They were unprofitable. It was a major reason for the stress that I had accumulated.
00:02:11:18 - 00:02:34:11
It was great to work with brands such as Adidas, Nike and Yves Saint Laurent, and I loved to speak about these brands and the work that we did. But I knew deep down that these projects, these unprofitable projects, were the ones that caused so many issues. It’s basic business sense. But in order to grow, to achieve financial freedom, to reduce stress, you need your projects to be profitable.
00:02:34:23 - 00:02:55:05
My wife had seen the stress I had endured, and I promised her that I was never going to allow myself to get into that position again. So what did I do? Well, I created the spreadsheet that we're going to work through in this video. As you'll come to learn. I now ensure that data leads my decisions. I've always been a data geek.
00:02:55:05 - 00:03:17:04
When I was young, I played a lot of cricket. I still do, but not to the level that I once did. And as a side note to those that know the game, I played three first class games of cricket back when I was looking to make cricket my profession. I played against Sussex, Glamorgan and Somerset and I finished my three game first class career with a batting average of 45, but then realized I wasn't going to make it in the professional game.
00:03:17:04 - 00:03:36:24
But I always like to get that statistic in when talking about cricket. Anyway, cricket is a game that drowns itself in statistics and data. It’s a lot like baseball. When I was young, I’d keep track of all my scores, the balls I faced, the fours I hit, the sixes, where I hit them, how I was out, and I'd collect all of that information,
00:03:36:24 - 00:03:59:09
season after season, into a big spreadsheet. I'd build all kinds of reports that gave me an insight into how I was performing, my weak points, my strengths. That's where I fell in love with data, and I've carried that love for data into my business life. And now into the businesses of my clients. The spreadsheet that I'm going to share with you has literally changed my life.
00:03:59:09 - 00:04:20:00
It's enabled me and my clients to make solid business decisions and to go after only the most profitable of clients and projects. The spreadsheet that I developed allowed me to dump eight years worth of projects into one document that did all the work for me. I took a simple export from Xero, which is my online accountancy platform, and copied the results into this spreadsheet.
00:04:20:00 - 00:04:40:06
Then I built a few columns that allowed me, and now you, to tell the spreadsheet what the data in each column means. But the basic strategy behind this practical lesson is that we review which customers, which industries, what type of projects, are most profitable to us as a business. We also look at whether going direct to client or via agency is most profitable.
00:04:40:07 - 00:05:08:03
Now, I'm not saying that you are only going to profile and look to attract your most profitable types of clients or industries. You may hate a particular industry, you might hate a particular style of project, and it's important that you enjoy what you do. That's what really counts. So the work that we're going to do here is designed to give us a steer as to which our most profitable clients, industries, and types of videos are, as well as if agencies or direct clients are most profitable.
00:05:08:03 - 00:05:37:00
And then we're going to use that data to shape our decisions and who we attract into our business. More on that in a minute. The ultimate goal is to attract a constant flow of these projects. If you create a constant flow of clients that are unprofitable, you're very quickly going to go out of business. But if you're confident that your perfect client is profitable, well, then you can go as big as you want on attracting those perfect clients to your video business with absolute confidence.
00:05:37:00 - 00:05:53:13
So let's get started with the actual work. We'll go through the following steps and it should only take a few minutes for you to do this. Now, to help you with this, below this video, there is a link to two resources. The first is a worksheet that will outline what we're doing here and give you a bit more context.
00:05:53:19 - 00:06:18:16
And then the second is the actual spreadsheet that I'll talk about and use within this video. So go ahead and download the template spreadsheet, the link to which you'll find below. Now, if you have an accountancy platform, download a CSV file or an XLS file of all of your invoices over the past 12 months, or as long as you'd like to review. It was eye opening to do this for the entire eight years of my production business.
00:06:18:16 - 00:06:41:04
But businesses bend and flex, so 12 to 24 months is usually the sweet spot here. If you've got the CSV or XLS file, open it, copy (Control-C) and paste (Control-V) the whole sheet into the first sheet of the template spreadsheet provided. If you haven't got an accountancy platform, you’ll have to enter this data manually, which might take a little bit of time but is absolutely 100% worth it.
00:06:41:16 - 00:07:03:11
Within the spreadsheet that you've downloaded, you'll see a sheet that's named ‘manual entry’, so you can simply fill out that list if you don't have the XLS file or CSV file. Now we need to go into the template spreadsheet again and update any of the information that we don't have. That may be industry, video genre, or even profitability. If we don't have the profitability on each project, just give it your best estimate.
00:07:03:17 - 00:07:25:17
You'll know what's taken a long time and what's been more profitable. Then jump into the review sections to see what clients, industries and genres are most profitable to you and whether going direct to client or via agency is most profitable. And that's it. That's the data review work all done. Now you'll have a really clear idea on what your most profitable client looks like.
00:07:25:17 - 00:07:48:01
And remember, this isn't yet your perfect client, but this gives you a steer as to which projects, clients, types of projects, and whether going direct to client or via agency, are most profitable. Now, once you've got this complete, you can select the industry that you're going to market to. And just like that, you've completely eradicated any unprofitable industries, clients and types of projects.
00:07:48:01 - 00:08:09:05
Like I said at the start of the video, there are plenty of other ways to increase profitability in your video business. You can develop systems, you can outsource work, you can track your time, you can raise your prices. But this, without doubt, from 15 years of experience within the industry, is the one task that has the most dramatic effect on your bottom line.
00:08:09:05 - 00:08:34:18
And as I've mentioned, this information is then used to build your marketing process, which coincidentally is exactly what my book The Lead Generation Machine does for you. And you can get it now for just $7 via the link below. Within this book, I walk you through the ten step process that will ensure that you drive a constant flow of opportunities (that are profitable and perfect for you) into your video business.
00:08:34:18 - 00:08:51:24
And the best thing is that once it's done, it's done and it works for you in the background of your business. So you can concentrate on the reason that you got into the game in the first place. And that's creating beautiful video content for clients that you are proud of. So the link is below if you want to grab that.
00:08:51:24 - 00:09:15:03
And as I said, you can get the entire framework - and all the step by steps - for just $7. And, if you'd like more marketing, sales and retention hints, tips, training and guides, you can join over 10,000 other video production professionals around the world in signing up to my weekly emails. Again, the links to do that are below this video, so I hope this has been helpful.
00:09:15:06 - 00:09:19:15
Here's to you and your profitable video business. Have a fantastic day!
