Have You Created an Impossible Business?
By C.J. Hayden, MCC,
info@getclientsnow.com
http://www.getclientsnow.com
4,400+ Translation Agencies! Click Here to Buy the Database!
 It's
easy to think that any business can be successful
if you work hard enough, but there are many situations
where this just isn't so. Consultants, coaches, and
other service professionals often start a business
believing that all they need to do is charge a "reasonable"
fee and sell "enough" of their time. But
unless you do the math to prove or disprove your assumptions,
you may be creating a business that can never succeed.
Here's what can happen:
-
Impossible Business #1 -
My
client Molly was selling her services as an image
consultant to individuals who wanted an updated or
more professional look. She charged $50 per hour,
which she thought was the most anyone would
realistically pay to work with her. In most cases,
she traveled to a client's home or went shopping with
her client.
Including
travel time and lunch meant that Molly could only
make two appointments in one day. The
average appointment was two hours long. So the maximum
amount Molly could earn in one day turned out to
be $200. But in order to earn that amount five days
per week, Molly would have to schedule ten different
clients, all of whose schedules were able to adapt
to whatever times she had available.
This
was hopelessly unrealistic. Even if Molly had been
able to make the scheduling work, when would
she have had the time to do the marketing required
to land that many clients? It turned out that the
maximum Molly could really earn using this model was
about $500 per week. After paying her taxes, she
couldn't even cover her monthly living expenses.
-
Impossible Business #2 -
Fred
was a student of mine who worked as a software consultant
for midsize corporations. He typically
charged $75 per hour, and when he landed a contract,
it often consisted of 20-100 billable hours.
Because
Fred's earning capacity was so high and he disliked
marketing, he spent a lot of money on
marketing himself indirectly. He purchased display
ads in industry journals and directories, mailed
expensive brochures to large lists of prospects, paid
to exhibit at trade shows, and hired a
telemarketer to prospect for him. Fred also worked
on contracts that came through agencies, who often
took 20-30% of his earnings as their percentage.
Fred
was earning as much as $80,000 per year, but he was
losing about $10,000 per year in agency
commissions, and spending $20,000 per year on marketing.
In return for all his hard work, he was earning
considerably less than he had at his last job.
-
Making the Impossible Possible -
New
consultants, coaches, and other professionals almost
always overestimate how much they can earn and
underestimate the amount of time and money required
to successfully market themselves. They also forget
that they will have to cover not only their living
costs and business expenses, but pay self-employment
tax, buy their own health insurance, provide for their
own retirement, and allow for unpaid vacation and
sick time.
If
Molly or Fred had taken the time to sit down with
a calculator before starting out in business, they
would have quickly discovered that they were on the
wrong track. But both of these businesses were able
to be rescued.
Molly
began selling her time by the day instead of by the
hour. She offered her clients a full-day
package that consisted of a wardrobe review and consultation
in the morning and a shopping trip in the
afternoon. By charging $395 per day and scheduling
three clients per week, she could earn more than
double than she did previously.
She
also began offering a monthly one-day image workshop
as a way of bringing in more income while
giving prospective clients a chance to experience
her work. The workshop became her main source of new
clients, and marketing the workshop turned out to
be easier than marketing her personal services.
Fred
learned how to market himself less expensively through
networking, speaking, and writing articles.
Instead of buying booths at trade shows, he was showcased
there as a presenter, and spent time
networking with the other attendees. The same publications
where he used to run ads now ran his
articles. Rather than paying a telemarketer, he started
picking up the lunch tab for people he thought
could refer him some business.
As
a result, his expenses for marketing and commissions
dropped from $30,000 per year to $10,000. At
the same time, his income rose to $100,000 per year,
because as his visibility and reputation grew, his
services were more in demand and he could command
higher rates.
If
earning a decent living as a self-employed professional
sometimes seems impossible to you, start
asking how it could be possible. What can you change
about how you are marketing yourself, how much you
are charging, and how you are packaging your services?
While it could be that success will come if you
just work a little harder, it's more likely that you
first need to start working a little differently.
C.J.
Hayden is the author of Get Clients NOW!
Thousands of business owners and salespeople have
used her simple sales and marketing system to double
or triple their income. Get a free copy of "Five
Secrets to Finding All the Clients You'll Ever Need"
at http://www.getclientsnow.com
|
