The Growth by Design Blog
Pulling Weeds
by The Renaissance Group on 02/04/10
As a business owner two of your challenges are:
- Not enough time
- Not enough profits
The lack of time and lack of profits are actually symptoms of an underlying problem. Although there can be several causes for time and profit issues, one that seems to be very common and cross many industries and business models is client selection.
Because most owners don't intentionally select who they have will serve, they add clients randomly. Many of these clients have different needs and you end up trying to be "all things to all people". This is not an effective or efficient way to run a business. You end up with multiple service models that are difficult to standardize and systematize. Without consistent systems, it's hard to replicate your service and the excessive time it takes to support multiple models eats into your profits and your free time.
You may even have a number of clients that are not profitable at all. Your profitable clients are subsidizing the time and energy you spend on these non-profitable clients. They are like weeds--left unchecked they will continue to invade--taking up more of your time and your staff's time. Ultimately, they will overrun your capacity to grow.
So what can you do?
- Track profitability per client
- Choose a target market to better focus your marketing and sales efforts
- Create a service model to serve this target market profitably
- Systematize all aspects of your service model to ensure efficiency and repeatability
- Prune judiciously - develop a strategy to weed out the clients that no longer fit
If you follow these strategies, you will have more satisfied clients, make more profits and have more free time to focus on the areas of the business you enjoy the most.
