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20 ways to make a million bucks
There isn't one best way, contrary to most popular opinion...
Nate Pinches
June 17, 2024
#18
Make a millions dollars! 20 different ways!
Influencers on Instagram and LinkedIn would like you to believe there is only one way to financial success — and that’s through the strategy they teach in their course. Dropshipping, MLMs, Amazon reviews, etc etc.
This weeks post just looks at the basic numbers behind 20 possible businesses that could hit $1 Million in profit.
So much of business is just simple math that it helps to see it once in a while.
If you see something you like, consider pulling it into your business!
The Simple Strategy
“Methods are many, principles few. Methods always change, principles never do.“
There are 4 principles to increasing profit for any business. You can increase:
Customers - The total number of customers; a factor of traffic and conversion.
Average Order Value - How much they spend at once; Pricing, bundles and upsells.
Frequency - How often your customers buy from you; Subscriptions and Limited Time Offers
Margin - How much you make; Raising prices and lowering costs
Multiply those four principles together and you get your profit.
Customers x AOV x Frequency x Margin = Profit
There are hundreds of methods on increasing these principles.
You can run ads (customers), to a funnel (customers), that leads to an order bump (AOV), with a nurture sequence (frequency) for a new physical or digital product (margin). The methods you use depend on the business you run.
I get tired of seeing one method get a ton of exposure, like running Facebook ads, when there are plenty of ways to grow profit in your business.
I often need concrete examples of something before I can imagine it for myself. So to help you think about how you might be able to increase profit in your business, here are 20 examples of businesses that could hit $1 Million in profit.
(This means $1 Million in cash that could be pulled off the business and put into personal bank accounts. This doesn’t mean $1 Million that is used to pay business debts, or is needed to reinvest, or to pay salaries, it’s just $1 Million in profit.)
Low Margin, Low Frequency Businesses
Customers | AOV | Frequency | Margin | Profit | Revenue | Example Business |
|---|---|---|---|---|---|---|
10 | $500,000 | 1 | 20% | $1,000,000 | $5,000,000 | Commercial Renovations |
100 | $50,000 | 1 | 20% | $1,000,000 | $5,000,000 | Industrial Equipment sales |
1,000 | $5,000 | 1 | 20% | $1,000,000 | $5,000,000 | Home automation installation |
10,000 | $500 | 1 | 20% | $1,000,000 | $5,000,000 | High end baby furniture |
100,000 | $50 | 1 | 20% | $1,000,000 | $5,000,000 | Ad-driven DTC product sales |
Low Margin, High Frequency Businesses
Customers | AOV | Frequency | Margin | Profit | Revenue | Example Business |
|---|---|---|---|---|---|---|
10 | $41,667 | 12 | 20% | $1,000,000 | $5,000,000 | High-net-worth Financial advisory |
100 | $4,167 | 12 | 20% | $1,000,000 | $5,000,000 | Corporate Training and Development |
1,000 | $417 | 12 | 20% | $1,000,000 | $5,000,000 | Monthly landscaping |
10,000 | $42 | 12 | 20% | $1,000,000 | $5,000,000 | Monthly Subscription box |
100,000 | $4 | 12 | 20% | $1,000,000 | $5,000,000 | Newspaper subscription |
High Margin, Low Frequency Businesses
Customers | AOV | Frequency | Margin | Profit | Revenue | Example Business |
|---|---|---|---|---|---|---|
10 | $125,000 | 1 | 80% | $1,000,000 | $1,250,000 | Corporate Management Consulting |
100 | $12,500 | 1 | 80% | $1,000,000 | $1,250,000 | SMB Management consulting |
1,000 | $1,250 | 1 | 80% | $1,000,000 | $1,250,000 | Productized Service |
10,000 | $125 | 1 | 80% | $1,000,000 | $1,250,000 | E-course sales |
100,000 | $13 | 1 | 80% | $1,000,000 | $1,250,000 | TikTok driven E-book downloads. |
High Margin, High Frequency Businesses
Customers | AOV | Frequency | Margin | Profit | Revenue | Example Business |
|---|---|---|---|---|---|---|
10 | $10,417 | 12 | 80% | $1,000,000 | $1,250,000 | Corporate law on retainer |
100 | $1,042 | 12 | 80% | $1,000,000 | $1,250,000 | 1-on-1 Coaching |
1,000 | $104 | 12 | 80% | $1,000,000 | $1,250,000 | Cohort coaching |
10,000 | $10 | 12 | 80% | $1,000,000 | $1,250,000 | Influencer Membership program |
100,000 | $1 | 12 | 80% | $1,000,000 | $1,250,000 | Newsletter subscriptions |
The Principles are Few
What can we draw from these examples? (Beyond that they’re all oversimplifications of real life.)
Revenue does not equal profitability. If you look at the low margin businesses, they’re doing $5 Million in revenue, compared to the high margin businesses who are doing $1.25M in revenue. All are making $1M in profit.
High prices require high value. All of the examples from the high AOV settings require a specialized, probably industry leading skill.
Margin matters. Just look at "Newspapers” vs “Newsletters”. The cost from printing is a big deal.
There are many many good ways to grow a business. You don’t have to do it like the gurus say you do.
To all the dads out there, I hope you had a wonderful Father’s day. My kids made me cards and my wife sent me to the gym to lift cause I haven’t gotten a chance lately, then we grilled. Pretty great day 😎
-Nate
One of my cards from my daughter was a tie. She said I was “loving, playful, generous, funny, friendly and awesome.” I’m inclined to believe her!
Whenever you’re ready, I help bootstrapped entrepreneurs increase their profit in two ways.
I help small business leaders unlock profitability in their business using AI. This high-impact course has only what you need in it to increase profitability and win your time back, with strategic frameworks for thinking about AI and practical plans to use it. Extraordinary price to value ratio.
Spots are open for this fall’s coaching cohort. It will run from September - November. This is a structured, 12 week program, with weekly 1-on-1 coaching calls with me. We spend the first 4 weeks resetting the foundation of your business, then clarify your definition of success for 2 weeks and spend the last 6 coaching to make it a reality. One of the most recent entrepreneurs brought her profitability up by 500% during the program.
Simple Strategies is written by Nate Pinches. He did an MBA so you don’t have to, has consulted for over 50 CEOs and has worked on AI projects for 6 years. He lives with his wife and kids in Okinawa Japan. |  not an AI, just a guy |
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