High-Class Problems (Dealing with Growing Pains)
Too many clients, too much work on your plate, lots of opportunities, people to say “no” to, too much money…
They may be high-class, but they’re still problems.
This chapter is all about growing pains: handling your own enterprise’s growth as the transition from part-time gig to full-fledged business becomes a reality. If you’re still stuck in “survival” mode, having too many clients to deal with might sound like a blessing. But there are challenges to growth, as well. Let’s learn how to deal with those challenges.
Project Management and Handling Lots of Customers
“Growth can be a tricky thing to embrace,” says Robin Hardy of MMPA-Marketing, Media & Production Assistance. “The key to successful growth (rapid growth) is to be prepared.”
In other words, start getting ready for lots of clients now—because even if you don’t have them yet, when you do, you’ll wish you’d planned ahead.
The quickest way to get started is to start using project management software. This software allows you to track, organize, collaborate, and access essential project details from a number of locations. Here are some of the most-recommended project management suites available:
- Asana. Advertising itself as “teamwork without email,” Asana is especially good at bringing teams together, which is useful if you have employees.
- Trello. A great tool for organization whether you’re a one-person operation or legion.
- Apollo. With contact management and project tracking, Apollo is a great tool for anyone who needs a singular place to work no matter where they are in the world.
These particular tools are also great for integrating with your daily checklist. If you handle your project management and your daily schedule from the same tool, you’ll clear more time for dedicating to your ever-expanding list of clients. With a simple download (or even a 30-day free trial, as many of these programs offer), you can be well on your way to managing and even solving one of your high quality problems.
Pricing Levels: How Much Should You Charge for Your Work?
Your marketing has worked, and now you find yourself communicating regularly with leads who are interested in hiring you. There’s just one problem: you’re not sure what price to quote them. You’re afraid that high prices will scare them off and low price quotes will have you working long hours for little reward.
How do you hit the “sweet spot” in which your prices are exactly where they should be?
The Quick Way to Determine Your Hourly Rate
One of the quickest ways to determine your hourly rate is to take a look at your yearly expenses and determine what it would take for you to earn a full-time income.
Let’s say you want to earn $50,000 a year before taxes. In order to earn that much, you should set an hourly rate commensurate with the amount of billable hours you expect to put in for your clients. If you plan on working 8 billable hours per day, or 40 per week, and you plan on working 50 weeks out of the year (giving yourself time for vacation and sick days), then you know that 50,000 divided by 50 weeks is $1,000 per week. $1,000 per week divided by 40 billable hours per week comes to $25 per hour.
You can tweak the individual variables as much as you like: increase the goal, decrease the billable hours, include taxes, etc. It all depends on your goals.
Flat rates can require a little more subtlety—and they’re often industry-specific. Jennifer Kyrnin at About.com notes that flat rates can be great for products and pre-defined services like web design. But as your (now) full-time gig expands thanks to your high quality problems, many people opt for an hourly rate. “And once you get more continuing customers, it's harder to keep the flat-rate structure, and that's when many designers move to an hourly rate,” says Kyrnin.
Luckily, there are a few strategies for determining your best industry-specific rates:
- Competition. Find a few of your competitors’ websites and simply ask them what their rates are for an equivalent amount of work. Upstream Commerce recommends some ways to find out about your competitors’ pricing.
- Networking. Simply asking other members of your industry what they charge for their services is a good way to make quick work of your decision.
- Local research. If your business is location-specific, you’ll have to do research into what local companies charge—and what local customers/clients can afford, as well.
Expanding Your Operation and Hiring Employees
There are a couple of ways you can expand your operation so that you are not the only one handling the work load: you can hire contractors or you can hire employees. Let’s take a closer look at each option.
Hiring Employees. Meggin McIntosh of Emphasis on Excellence, Inc., suggests a strategy of “hire slow; fire fast.” Hiring “slowly” prevents you from hiring too fast when you experience rapid growth, a problem many first-time entrepreneurs struggle with. “Firing fast” refers to holding a high standard for who “fits” within your organization the way you envision it.
When you do hire, it’s important to write a job description that doubles as a performance review tool. Setting important job benchmarks from the very outset of your employer-employee relationship will allow you to make the proper evaluations for whether or not you truly need to “fire fast.”
Entrepreneur.com also offers an extensive guide to hiring your first employee —including tackling issues like drug testing and whether or not to trust your instincts.
Hiring Contractors and Freelancers. Contractors can be easier to manage because they have to worry about their own employment. The only problem? You won’t get their complete and undivided attention.
There are plenty of places to hire freelancers and contractors who might be able to provide the services you need:
- Freelance websites like Elance and oDesk.com. These sites can be used to find anything from designers and programmers to virtual assistants and writers.
- Crowdsourcing websites (usually for writing and design-related jobs) like 99designs or CrowdSpring.
- We’ve compiled our favorite places to find freelancers online in a popular blog post, so check it out.
It can be tricky to convince great candidates to come work for you when you’re first starting out, so be sure to:
- Stress how much ownership and responsibility they’ll have as your company grows.
- Self-examine what you offer, making sure it’s competitive and that there’s room for your new employee to grow.
- Consider getting creative with perks. You might not have the money to offer a huge salary, but you can offer interesting benefits that make it worthwhile.