Uncertainty is an enemy of business just as kryptonite weakens Superman. It’s difficult to predict or forecast what will happen. Whether that is paying yourself, paying employees who rely on you, or putting food on the table. If you’d like to see my other reports, check out the Income Report tag.
In Q3 of 2020 I noticed a change during the pandemic. Companies began their work again. My Professional Services increased 199% compared to Q2. It is a good sign but how long will it last given the restrictions due to COVID19 happening all over the world? People must be getting frustrated over the pandemic and so business must move forward. The shift I’m noticing is less carpeted office work. But warehouses and research labs continued to push through.
The Clear To Send podcast released its first course and we saw some sales trickle through. We weren’t expecting a large number of people purchasing the course but we wanted to release something we cared about. Over the next 12 months I can compare how these sales perform.
Income Analysis
Overall, revenue increased 10% compared to Q2. I’ll take what I can get with an increase that big! But revenue is just a portion of the picture. With Q3 at a close, net income was down -81%.
As I noted in the beginning, the Professional Services section of revenue increased 199% compared to the previous period (PP), Q2. It’s the main focus of my business at Packet6.
There are highs and lows in business. And when you aren’t watching cash flow or line item details of where money is spent then you have those lows.
Hardware and software sales have consistently been a weak area for me. The disappointing part is not making people aware that I resell Cisco, Meraki, Juniper, Mist, and other vendors. I’m missing out on a significant amount of potential revenue. On the plus side, I saw a 15% increase in reselling activities but it was a small percentage of revenue.
I’m not disappointed in Q3 because I still have a good amount of cash saved up in the business. That’s an important objective of mine because it can also help keep the business afloat during rough times.
Expense Analysis
A goal I made at the beginning of 2020 was to decrease expenses. I made some risks in Q3 that increased expenditures. One of those was learning how to do sales.
I invested in training since I didn’t know how exactly to do sales. It didn’t work out the way I wanted to but I did learn a few things.
Luckily, General & Administrative Expenses did decrease by 66% but I did have to pay for taxes from 2019. One tip for those starting a business is to save for these taxes so you’re not shocked during tax time.
Lessons Learned
Reflecting on Q3, I realized I had not looked at my reports regularly. I’m referring to the expenditures compared to income. I saw Q3 as a way to take on new challenges and take calculated risks. The results won’t be instant but they were made to survive through this pandemic.
Occasionally, you need to make a calculated risk. The outcome could be rewarding, such as higher revenue. I’ve placed a lot of focus learning how to do sales, to create a process, and experiment with non-traditional sales methods.
Learning when to pivot and how is not just important but life saving.
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