Episode 202: Balancing Fixed and Variable Costs in Your Business

Welcome back to the Empower Her Business Accelerator podcast! I'm your host, Philippa Channer, and I'm thrilled you're joining me for another week of practical strategy and CEO-level insight. We're deep into our October series all about understanding your business cost structure—and today's topic is one that every entrepreneur thinks they've mastered but often hasn't truly leveraged: balancing fixed and variable costs.

This conversation is about more than bookkeeping—it's about creating freedom and flexibility in how your business grows. And before we dive in, I want to take a moment to invite you to something very special: The Entrepreneur Incubator.

This is my four-month, done-with-you experience designed to help ambitious entrepreneurs get clarity on their brand, build a sustainable strategy, and—most importantly—implement it with accountability and focus. Inside the Incubator, we'll work together using tools like my Content Clarity Canvas and the Content Clarity GPT to build a tailored 12-week content plan that actually supports your business goals. You'll also get one-to-one coaching and monthly implementation check-ins so your strategy never just sits in a notebook—it comes alive in your business.

If you're craving that structure and want to stop guessing about your next marketing move, schedule your free 30-minute consultation using the link in the show notes below. Let's talk about how the Entrepreneur Incubator can help you level up your business from the inside out.

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(00:00) What Fixed and Variable Costs Really Mean

Let's start with the basics. Fixed costs are the expenses that stay steady no matter how much your business grows—think rent, software subscriptions, business insurance, or a salaried assistant. These are predictable, but they can also create pressure when sales slow down.

On the flip side, variable costs shift with your business activity—things like shipping, payment processing fees, hourly contractors, and materials. When business is booming, these rise; when things slow down, they ease up.

The balance between these two categories affects your cash flow, profitability, and even your confidence as a CEO. Fixed costs bring stability, but too many of them can make your business rigid. Variable costs bring flexibility, but too many can make your margins unpredictable.

👉 Action Step: Identify your top five fixed costs and top five variable costs this week. Awareness is the first step toward better decisions.

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(00:03) Finding Your Financial Sweet Spot

When your fixed costs are too high, you end up working just to stay afloat—your revenue has to constantly chase your expenses. When your variable costs are too high, you might be scaling, but your profits shrink every time you grow.

Your goal is to find that sweet spot: a lean, intentional mix that aligns with your business model and stage of growth. Ask yourself:

• Do I have consistent income to justify my fixed costs?
• Are my variable costs growing faster than my revenue?
• Can I shift certain costs from fixed to variable—or the other way around?

👉 Action Step: Review your subscriptions and vendor agreements this month. See what can be made more flexible or predictable to support your current growth phase.

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(00:05) Restructuring Your Costs Strategicall