By Christa Myers
The horse industry is notorious for not creating profit.
Running a business in the horse industry is difficult, there is no denying that.
The bills are expensive.
Cash flow is tight because a client is late on a payment.
The horse had an unexpected vet bill.
Competitors race to the bottom in pricing.
There is a lot against us.
Money can be made in horses but only if there is a plan.
If you handle that money properly, profit can be made.
Financial operations matter in a business. Money affects every area of a business.
Profit is a myth in the horse industry because we very often price based on data.
Before your sales begin to make you money, it’s important to know the amount of money that must be made to cover the bills. By pricing based on data, you can make sure you’re creating profit. This begins with capturing all of your expenses.
Questions to ask yourself when pricing:
Who do you want to work with?
How much tax do you expect to pay?
What do you want to offer?
How often do you want to work?
What lifestyle does your business need to support? (equestrians are expensive)
The amount of money to reinvest in the business?
Stop pricing yourself low to attract customers. When pricing, start by developing a budget for yourself and your business. This is important if you don’t rely on other sources of income. Bills need to be paid. Once the business has been set up to make money, it needs to be able to handle it.
Profit is a myth in the horse industry because we don’t know how to handle the money.
( I hope you saw this coming.. being I have a bookkeeping business)
Everyone hates it, but it needs to be done. Bookkeeping is the financial storybook of your business. It holds many of the questions equestrian entrepreneurs ask themselves;
How much am I making?
Can I pay myself / give myself a raise?
Which invoices clients haven’t paid yet?
Have I paid all my bills?
Do I need to raise prices?
Which services bring in the most money?
Where am I losing money?
Equestrian entrepreneurs often avoid their books as they do commit to a distance (or something else punny here).
Over the last year, I’ve come to believe that we don’t avoid it because we’re lazy or not smart enough. We avoid it because we believe it’s scary. The time commitment and chance of messing it up keep us from setting it and completing it.
Eliminate the spook in bookkeeping. Educate yourself to understand what you need to do and why it’s important. Empower yourself to believe you are worthy of money and can handle it properly. Actionable steps that can help bombproof your bookkeeping;
We didn’t learn to jump in our first riding lesson, your bookkeeping journey is similar. You’ll need to first lay your financial foundation before building. Growth is uncomfortable and as the CEQO™ of your equestrian business, you need to be comfortable with being uncomfortable.