Would you like to earn more money in your business?
Most of us would like to grow revenue. If that’s true for you, then the advice Sylvia shared one recent Friday morning in a high-spirited interactive session should be of value to many of you. No doubt you use several of these money-earning methods in your business now, but there may be a few that could help you think differently about how to add to your bottom line.
This presentation was courtesy of Sylvia Inks, a savvy, lively, down-to-earth business and financial coach who specializes in helping small service business owners “understand your numbers and increase your profits” (from her website).
[BTW… yes, it’s been more than a few weeks since I last shared a post here… but I’ve been busy for you! All-new website content is live, including new resources for those managing practices in the healthcare, wellness and coaching spaces–and of course this Virtual Visit.]
I’d love to hear the results you have from trying any/all of these money-making ideas—I’m sure Sylvia would welcome hearing from you too (her contact info, as well as a link to her book and website, follows).
Let’s say you decide you need (or want) to grow your earnings. How would you go about it?
1. Make more sales.
> You might achieve this by adding clients/customers of course, and that’s probably the top solution business owners look to. You might also look at adding more products or services—e-books, classes, creating tools/resources adjacent to your primary services.
> A potential negative effect to be aware of: you’ll likely need to put in more time and effort—you’ll need to consider if that’s realistic or desirable for you right now, related to your overall quality of life.
2. Raise prices.
> Where do you fit in the overall competitive range for fees? What is the value of the result you create for your clients? If there’s wiggle room (and there often is, as undercharging is a chronic issue), this could be a good solution.
> You may initially think this risks losing clients, but as Sylvia has seen with her clients (and was reinforced anecdotally through about half the room at the meeting I attended), usually this opens up space for you to add and serve clients who are prepared to pay what you are truly worth.
Wendy’s Note: You might want to plan ahead for this action, and start the new client acquisition process a little ahead of your price increase to current clients. If you know it takes a few weeks or months to close business, use that as your guide for how far ahead to start your effort.
3. Decrease costs.
> A good way to increase profitability, if not overall revenue. It’s always worth assessing your costs, particularly subscriptions costs, as they tend to add up if you’re not paying close attention while you’re going about your business. Check that you’re really using and getting value, and periodically compare services to new options available.
> The potential risk here: you’ll need to be on the watch for making penny-saving moves that ultimately have a negative impact on the quality of what you provide.
4. Raise your average order value.
> Think: “do you want fries with that?” You know your business and what benefits you can create better than your clients do—so think ahead for them. Offer them something they may not realize is available. What might your clients want to add to the item or service they’re currently buying? Can you create a bundle or package that will benefit your clients?
5. Promote affiliate products.
> This is an area that Sylvia uses to considerable advantage herself: It requires relatively little effort but can add up month by month. In this method you promote other services or products—ones you like and use—on your website and/or through your various communication channels.
> Many/most services, in particular, will give you a referral fee or affiliate commission when those you refer, purchase. Very few people in the audience were using the strategy, yet it is a highly effective, largely passive income stream—and one that helps your clients as well. Some businesses are able to set up whole additional business units built on strategic affiliate partnerships.
> Where to find them? There are many companies that have pre-established programs for this; if there is a service you subscribe to, or a business you love, check their website for affiliate or referral programs. You might also consider negotiating referral programs with people in your personal network-referral circle (but be sure to put the agreement in writing so everyone’s clear on the details).
A few caveats mentioned at the meeting:
> Choose affiliate products that you believe in, and that are in line with your brand and your clients’ needs.
> Be sure always to disclose that your link is an affiliate link—it’s important to be upfront. Plus many people will want to help support you, and be glad you’re receiving a little compensation for the value you share.
> On the flip side of the affiliate arrangement, you might want to set up a program for others to give them a referral fee. When considering commissions, think of the total cost of your time and expenses in acquiring a new customer as well as their life time value to your business. A 30% commission is fairly standard, but higher is not unheard of.
Wendy’s Note: the 80/20 rule, which applies to so many areas, is a good rule of thumb to guide you in how often to share affiliate sales info vs other content. It’s not a bad rough guide for the number of “selling vs. educating” messages you use in your social media and email communications, too.
If you’d like to learn more about Sylvia and her business, visit her SMI Financial Coaching website.
I also highly recommend her book at its website: Small Business Finance for the Busy Entrepreneur, also available at Amazon and several independent bookstores in NC, including Page 158 Books in Wake Forest. I’ve been a small business owner and operator for many years, and have worked with many accountants, and found this book packed with accessible, smart, actionable recommendations.