No matter how many years you’ve been in business, you’re likely to eventually come upon a crossroads: you want to make more money, but you only have a set amount of time.
You’ve done a lot of work already in discovering and setting competitive prices for what you have to offer, so what’s the next logical step?
The Problem: Gotta Get More Customers!
Many business professionals mistakenly think that the only way to make more money in their service business is to simply fill those funnels with customers, customers, customers. Entire bookstore shelves are brimming with how-to guides and advice on how to reach more clients, keep the ones you have coming back, and generally fill your business coffers to bursting.
But the problem is, more customers means more demand on your time. You simply tell yourself to work harder, because you naturally want to please everyone. Unfortunately this leads down one path with burnout being the eventual outcome. You can’t let yourself get stretched so thin that one unhappy client causes you to snap.
The Myths We’ve All Been Fed
The entrepreneur’s mentality with making more money usually falls into two camps: either save more, or work on creating passive income so you don’t have to work so hard. After all, setting up a system one time and continuing to make money from it sounds like a great idea, right? In theory, yes.
The problem is, without constant nurturing (which takes more time and effort), that passive income will eventually dry up, leaving you right back where you started and continuing the cycle of working harder to set up what ultimately will become sand castle business foundations.
When it comes to saving, no one is denying that it’s a good idea to tighten your belt if the situation calls for it. But when you’re cutting back to the point that it affects the way your business runs and cuts into your productivity and efficiency, it’s only a means to an end rather than a well-planned strategy.
Pouring All Your Energy into the Stuff They Tell You
When you’re just starting out, you do exactly what the gurus and well-meaning advisors tell you: you create a website, your network, you set up social media profiles. You tell everyone you know.
Then you wait. If you’re “lucky”, business starts trickling in. Even then, it seems that the customers you do get are as fickle as the changing winds and have no concrete reason to stick with you– particularly if you’re in an ultra-competitive service industry (think virtual assistants, web/graphic designers, and so on).
So what’s the solution? If you can’t work harder and have a finite amount of time available to help the clients you do get, how can you squeeze every drop of profit out of your service business without running yourself ragged?
The Answer: Creating Lasting Value
Stick with me, here. [pullquote]This isn’t some frou-frou business management pie-in-the-sky theory. [/pullquote]It’s easy to tell people “create value for your customers”, and another thing to actually do it. The issue is that no two service businesses are alike, so what constitutes value for one may be par for the course for another.
Another problem that inevitably crops up is that business owners have a knee-jerk reaction that creating value has to equal something that inevitably adds to their workload. But intangible value can be created in several ways that won’t add exacerbate your time/work ratio.
Oftentimes, especially for businesses with several employees and departments, there’s a notable disconnect at various levels depending on the amount of engagement that department does with the customer (online or offline). One of the best ways to add value, demonstrated by brands like Zappos.com, is to create the same impression of the company regardless of the customer’s circumstances.
These kinds of shared values are hard for even the biggest copycat competitor to try and duplicate, which is what makes them so important for businesses to cultivate.
Watch Out for this Major Mistake
One of the biggest pitfalls that catches up to business owners is that they fall into the mentality of “if this doesn’t work, it’s time to start cutting things” – hosting a big sale, giving deep discounts, offering freebies. All of these techniques have their place in the sales closing process, but they shouldn’t be something that you do out of desperation.
Instead, think about raising your prices – even if they’re already outside the “norm” charged by your competitors. This allows your momentum (and revenue) to double – you might lose a few clients (who likely only stuck around because the price was low), but you’ll gain so much more: more money, fewer demands on your time, and greater customer retention to name a few things.
The bottom line is that people realize they get what they pay for. Some will be content to scrape at the bottom of the barrel, but those who are truly invested in their own success know that results come at a price. Look at ways where you can add any one (or all three!) of the intangible value propositions noted above. What can you do that will make a bigger impact on your clients for a 10%, 20% or even 50% higher price? What things do they value and how can you deliver that to them while still ensuring you stay true to the foundational pillars that got you started?
When you start sacrificing and cutting things, those pillars become shaky and your consistency and commitment suffer. Instead, focus on carving out a niche for yourself among the “me too” crowd, and become known as the go-to person for that specific service. Always look for ways to improve the quality, delivery, timeliness and follow-up from every step of your service process. Those things, in turn will improve the intrinsic value of your offer and help catapult you to “in-demand” status.
Don’t Be Afraid to Make Course Corrections
And of course, no particular plan should ever be set in stone. Businesses that cling rigidly to a plan that ultimately proves not to gain as much traction as they’d hoped are only deluding themselves as to its popularity. You will need to tweak, refine and rework various steps to create a memorable experience for your customers each and every time. Just remember that every adjustment you make is one more step toward reigniting that entrepreneurial fire without burning out!
What Are Your Thoughts?
What are some ways that you’ve been able to make more money through doing what you’re already doing? How do you add value to your offer in a way that makes it more worthwhile to your customers? Share your thoughts, perspective and comments with us below! We want to hear about your successes!