Do You Have Enough Clients For Your Business To Survive?
Winter is always a time for reflection and evaluation for me, how well did I beat my goals and if I didn’t, what can I do to make sure they’re met next year?
A big part of running any business is cash flow, and for that, you need paying customers! So one of the goals I set each year is ensuring that I have enough customers to enable my other goals to be met.
So, here’s a serious question for you. Do you have enough clients to survive?
Now you’ve probably answered that by:
- saying yes!
- “I think so”
- no, I definitely don’t
- or, how many clients do I actually need?
It’s the latter responses I want to focus on in this blog and help you to establish how many clients and/or income you need for your business to survive next year.
How many clients do you personally need for your business?
This is always going to vary from business to business determined by what you do, who you help and how much you can charge. The best way to figure this out for yourself is by setting a goal of how much income you want to achieve – aim for a comfortable lifestyle rather than enough to pay the bills!
Now that you have a figure in mind, how many clients do you need to achieve that?
Let’s say that you want to bring home £3000 a month and sell services on an hourly rate of £30.00 – that means you’ll need to “sell” 100 hours to make that amount. How many clients do you have and how many hours do they average? Use this to establish how many more clients you’ll need.
Retainer packages are often better than hourly rate because it’s so much easier to know where you stand and how many more you need to deliver. If your standard retainer package is £500 a month, then that’s 6 consistent clients that you need. For £250 a month it’s 12, and so on.
I find that having consistent recurring income with a set number of retainer clients that’s topped up with one-off or smaller projects at an hourly rate is a great way for me to ensure that my business can go from strength to strength while keeping my work varied and interesting.
Keep your existing customers happy
Recurring custom from existing customers is the best way of ensuring your business survives rather than constantly trying to find new clients and hoping the search will prove to be fruitful. When you look after your customers well they can see the value in what you do and are happy to pay what you’re worth (so make sure you keep your prices right for your skills and expertise).
As you develop as a business owner and what you offer changes/evolves over time, make sure you keep your existing customers aware. Are you offering new services that can benefit them? Can you add extra value to their retainer and increase the cost? Going back to the 3k month – 3 happy customers paying 1k a month is a lot easier to manage than 6 paying £500. Is there scope in what you do to aim higher with fewer clients?
Are you consistently marketing to avoid feast or famine?
When you’re overwhelmed with work and earning what you’re worth it can be easy to skip the marketing because you don’t have the time for it and can’t see the need. But then your clients move on, the projects have finished, and you’re left with barely enough work to cover the bills.
Feast or famine is all too common among business owners, and it’s partly down to inconsistent marketing. When you’re marketing from desperation, it can be easy to attract the wrong audience and customers to your business, making it even harder to earn what you’re worth and survive as a business.
Keep your marketing consistent and aimed at your ideal customers rather than an “I need the money so I’ll work with anyone” approach. It gives you room to breathe, enables you to assess how good a fit your prospects are and ensures that you have a steady income rather than a fluctuating one.
If you are struggling for time outsource your marketing to a professional – it’s one of the best business decisions I’ve ever made!
Have a contingency fund in place to avoid marketing from desperation
If you do work in an industry where fluctuating incomes are the norm, consider setting up a contingency fund and adding to it during the good months. Around 6 months income that’ll see you through any dry patches without having to resort to freelancer platforms or getting a part-time job will give you room to breathe.
Make sure you have income protection insurance in place in case you’re struck by illness or accident and are unable to work for a while. It’s also a good idea to have a plan in place in case this happens of trusted associates who can take over the work for you and keep things ticking over while you recover, ensuring that you still have a business to come back to!
Getting the balance right can be tricky as a business owner but hopefully, you’ve found my suggestions useful in figuring out how many clients you really need to survive and ensure a consistent income. Contact me today if you want some support in 2019 to explore how you can have a successful business by focusing on what you do best and outsourcing the rest.