My Q2 2021 Income Report

July 8, 2021 By Rowell Leave a Comment

Here is the second installment of my quarterly income report. I use the income report to summarize what has been happening in the business, where revenue came from, analyze my expenses, and reflect upon what actions have positively or negatively impacted the net income.

Highlights of Q2

There’s no shortage of work. Packet6 is a small business operated by my wife and me.

Happy Birthday

Q2 marked the year Packet6 turned four years old! It’s remarkable how many clients we’ve been able to help in that period. And this quarter, we thought about the processes we can improve to make the business run like a well-oiled machine.

A Yearly Retreat

One decision we made was to include a yearly retreat. For our second annual retreat, that meant spending two days without the kids, thinking about the business’s past, present, and future. We change our surroundings to keep our minds fresh.

It involves thinking about what worked well for us, what didn’t work, and what needs to change.

Security Is Everyone’s Responsibility

Adding to our list of expertise, Packet6 became a Palo Alto Networks (PAN) reseller. When working with our clients, we’ve found that they come back to us asking if we can work on other parts of the network. That includes switching, routing, and firewalls.

I consider PAN to be a strong vendor in the security landscape, so I decided to become a partner and resell their solutions. It’s primarily the NGFW products, and it could branch out from there. Baby steps.

Lessons Learned

Travel

Wearing a mask has never bothered me, and I also received my vaccination in March 2021. It made me confident to travel for clients that relied on Wi-Fi.

Using my stockpile of vacation from my full-time job, I flew to Kansas City, St. Louis, New Jersey, and Seattle. While I like traveling, trying to condense some of those trips as short as possible can be draining.

Sales

In Q1, I spent time reading as much as possible about creating a sales process and sequence to generate a sales cycle. It’s not easy holding multiple roles, but it challenges your mindset.

Discipline is at the heart of sales. I wouldn’t say I like doing it, but there isn’t any revenue if there aren’t any sales. I’m not as consistent as I’d like to be. It just means I need to change my system to be more efficient. Set goals around how many calls/emails/connections to make each week.

I did not make one conversion from my sales process this quarter.

Income/Expense Analysis

Current QuarterPrevious QuarterChange% ChangeRevenue$209,419$32,853$176,566537%Expenses$67,156$43,719$23,43754%Net Income$145,991-$10,845$156,8361,446%Professional Services$59,236$26,805$32,431121%Affiliates$55$25$30118%Hardware$156,889$17,412$139,477801%

In previous Income Reports, I’ve talked about decreasing costs to increase the net income. It’s easy to say, but as you can see, expenses rack up! People like to focus on the revenue number. But after you subtract the expenses, then you’re left with the take-home money.

I wanted to highlight some areas of revenue. Professional Services wasn’t isolated to a specific metro region. There was an increase in professional services, primarily Wi-Fi design, configuration, troubleshooting, and validation. That’s where I begin to reach my capacity and need to look for additional resources.

The reason why I highlight Affiliates is due to its form of passive income. On this blog, you’ll see links to resources I use. Some of those resources are affiliate links, mainly from Amazon. I receive a percentage of a purchase made through one of my affiliate links. It’s not much, but I also do not focus on Affiliates.

A significant shift in Q2 came from reselling network equipment. It was a mixture of Meraki, Juniper/Mist, and Palo Alto Networks. As a network engineer, I have the insight into creating an accurate bill of materials. I’ve seen other resellers try to sell over the moon with hardware, upselling more than required products, even for growth. So you won’t see a sleazy sales guy from me.

The challenge is being consistent with those hardware sales, and the struggle is real. We don’t have a dedicated sales rep to increase these numbers. That’s me.. for now.

Where we can improve is in the expense category. There’s room to decrease expenses. We’re probably paying for too many web app subscriptions. One of our goals is to analyze what we’re paying for and whether it contributes positively to the business. If not, it goes—Marie Kondo style.

What’s Next

It’s time to implement systems and processes. I’m only one person. We’d love to bring on an additional engineer to help with Wi-Fi projects. We want to be sure it also fits within our budget. More backend business work needs to be implemented to support this plan.

Professional Training is another area we’d like to grow, but it’s percolating as an idea for now. More planning needs to happen.

Then there’s buttoning up the business. The training we need to take for specific processes, like bookkeeping, which we will eventually outsource.

Exciting things are happening!

Cheers