Part of starting your coaching as a business is knowing what a sustainable business looks like for you and what you need for that.
And for me that starts with 'running the numbers'.
These two examples are VERY simplified calculations. The ones you would make on the back of a coaster. But still a very valuable start.
Example 1: I know want to make an x amount per year
I want to make 40.000 euros a year (incl Tax). In the future I might want to add other services like trainings, workshops, groups but for now I only focus on 1-1 coaching.
My Current Package is 800 euros for 3 months.
This means I need 40.000 / 800 = 50 (3 month) clients per year
I need to check:
Am I able to handle 50/4 = 12,5 clients at a time? If I have bi-weekly sessions this means 12,5/2 = about 6 clients/sessions per week.
Do I have that time and do you have enough time left for my admin/sales/marketing etc?
Does it feel reasonable to get a consistent stream of 50 clients (or extensions) a year, which is an average 4 new clients per month? (Or clients that extend for another 3 months). How long do I want to give myself to get there?
If not, there are several options and questions:
Do I feel good about raising my prices?
Should I add something else to my offers so my income does not only have to come from 1-1 coaching?
What’s my runway? How long can I give myself to get to my desired income? It’s a big difference if I have 6 months until my funds run dry and I get nervous or if I have 2 years.
Example 2: I know I can have max 10 clients / sessions per week.
I offer 3 month packages and bi-weekly sessions.
My current package is 700 euros for 3 months.
This means I can have 2 x 10 = 20 clients per month
A client will stay 3 months, so I can have a maximum of 4x20 = 80 clients per year
That is 80x 700 = 56.000 euros per year
Is 56.000 euros a sustainable income for me? If not, do I want to raise my prices or add income in another way?
Does it seem do-able to get an average of 6 new clients per month (or people that extend after 3 months) and how long will that take me to get there?
What’s my runway? How long can I give myself to get to my desired income? Again: It’s a big difference if I have 6 months until my funds run dry and I get nervous or if I have 2 years.
Example 3: also add the hours you work ON your business
Another thing you can write on your coaster is how much your hourly rate is (again this is a coaster example) when you also take into account the hours you work ON your business (admin, sales, marketing, business development etc):
Total hours of working in and on your business for example 2:
80 clients x 6 sessions per package = 480 hours of coaching
Every week I spend 1 hour on admin = 52 hours per year
Every week I spend 2 hours on marketing and sales = 104 hours a year
Every week I spend 2 hours on preparation for clients = 104 hours a week
That is a total of 740 hours
56.000 euros / 740 = 75 euros per hour