This quarterly income report is a documentation of the ups and downs of being an entrepreneur. I’m being transparent with the journey. You’ll find what worked well for us and what hasn’t worked so well so you can avoid any of the same mistakes I’ve made and gain from our successes.
Take a look at my other Income Reports.
Here’s a summary of Q3 2022.
Gross Income: $107,469.51
Cost of Goods Sold: $38,893.13
Total Expenses: $67,687.27
Net Profit: $889.11
Net Profit difference from Q2 2022: 104.59%
The third quarter seemed like a blur to me. But it was one busy one leading to seven new clients added. That might be a record for us in a single quarter.
An anomaly that seems to happen every few months is the higher than normal reselling activity. We’re not actively telling the world we resell major vendor hardware but with existing clients, it’s a big plus for us as we nourish the relationships we’ve created.
In addition to reselling, we’ve converted a few existing clients into a monthly recurring revenue model which we call Managed Network Services. It’s nice to see a new service gain some traction and in a way that is very manageable.
Burn out is still a thing. We’re at a pivotal moment in the business where additional help has been brought up in multiple discussions.
Some deals didn’t go as planned. A deal went into negotiations but I failed to think things through slowly and went forward with something not as profitable but hoping for something bigger later down the road. We’ll see how it plays out next quarter.
Chasing overdue invoices is never fun and it eats up a lot of time. Most companies are very good with paying on time but it’s ridiculous we have to follow up so many times to get an overdue invoice paid. My advice for any small company is to get 50% paid for up front.
Packet6 drove in a total of $107,469.51 in revenue for Q3 2022. That is a -12.03% decrease compared to Q2. The contributing factor is pro services being down by 50%. There’s only so much work you can take on and the invoicing was slower on our end with other invoices being paid late.
But hardware reselling was up 57,320% compared to Q2. Sales cycles are longer, waiting for purchase orders, hardware to ship, etc. With hardware taking longer to ship it becomes a challenge to invoice. As this blog post goes live, I’m still waiting for Meraki to ship equipment that was ordered in August 2022.
If you’re interested in what hardware was sold it was primarily Cisco switches and Mist access points.
Managed Network Services was half of what our revenue was for professional services. It’s a good balance for predictable income but I need to be cautious with the amount of work that is being juggled.
Our average sales revenue per pro services project is $3,840. We’re planning to increase this number by looking for higher value projects.
The great thing is expenses are down 41% from the previous quarter.
Vehicle related expenses were down 39%, web hosting decreased by 37%, and a big dip in SaaS expenses by 70%.
The current plan is to replace or get rid of certain SaaS applications where we do not see value today.
We need to focus reducing office supplies expenses.
Our largest expense item was ZoomInfo and if I’m being honest, it hasn’t been as useful for us. It was an experiment we dived into that hasn’t brought in a good enough ROI. Vehicle expenses remained one of the higher expense items which was mostly due to electric charging. There was a lot of driving to client sites. And lastly we increased training expenses with books and video tutorials.
Our net income for Q3 2022 was $889.11 which is a 104.59% increase from the previous quarter. Not a big net profit number but this quarter we are positive!
I think we’ve done enough experiments with SaaS products to see which ones help and which do not. But we’re implementing processes for expenses so we can keep a better eye on where money is going.
It’s time to buckle down and increase net profits while aiming for small growth.
Burn out continues to be present and in some areas I tend to lack focus and commitment. I’ve realized there are certain areas of my routine that need improvement such as exercise, meditation, and rest.
We want to end the year on a high note and begin planning for 2023. Think about our values and if what we’re doing aligns properly.
Look to adding additional help to delegate tasks. Train up on business finances and lose excess financial weight (expenses).