By Caterina Rando, MA, MCC
You could be working overtime running your business and be doing things that are stunting your revenue and not even know it. This is the case with many women entrepreneurs. Let’s make sure it is not the case with you and your company. Review these common silent revenue killers and make sure they are not lurking around your business:
Not Knowing Your Cost of Goods/Services Sold
Every company is different and every company has a different cost of goods and services sold. If you are charging what everyone else is charging just because everyone else is charging it, then you may not be charging enough. You have to be sure to include a percentage of your fees for overhead, marketing, sales and materials. Have a few percent in your fee for unexpected expenses because there always are.
This is always one of the first things I look at with my clients because I have seen way too much guesstimating rather than number crunching when determining fees. Also, it is okay to charge more than the other firms that do what you do. You do not really want clients going with you just because you are the cheapest. Before you take on one more client, figure out your costs to be sure you are making money with all you do, every time you do it.
Not Regularly Revisiting Your Fees
When women entrepreneurs tell me they are working really hard and not making money, I always ask if they have a full roster of clients. The reality is you can be working hard at sales, marketing, operations and finance and still be serving just a few clients. When women entrepreneurs tell me they are full up on clients, then I say raise your fees and do so while looking at how you can better serve your clients moving forward. When you raise your fees, you may lose a few clients, however you will still earn more and while making room for better paying clients.
You could choose to only raise your fees on new clients and tell your existing clients you are keeping their fees the same because you value their business. When you do this though, let them know that their fees will be going up in the future and tell them when that will be. Now take a look at your fees. Are they over due for a raise?
Charging by the Hour
A lot of women are still charging by the hour. If that’s you, let’s look at why that is not a good idea. When you charge by the hour, each hour could be your last with that client, because in many cases at the end of that hour, they have to make another buying decision if they want another hour. That means over the course of a year, if you were providing them one hour a week of service, they would have to make fifty-two buying decisions instead of twelve, or six or four depending on how you structured your fees. Instead, provide service by the package, by the month or by the project. This way, they are committed to working with you for the long term and you won’t lose your clients depending on their mood on any given day.
Also, there are times of the year that are slower in many businesses. When you sell packages, you keep getting paid even if people are traveling or not coming to see you as often due to weather, graduations or other life events that can interfere with a steady flow of clients for many businesses. I have seen many clients add cash flow consistency to their businesses by moving to project packages instead of by the hour. See if this would benefit you and your business.
There are many ways to make sure you maximize your revenue in your business. Start now and review your costs of goods/services sold, your fees and how you charge to ensure you do what works for your business. Make any changes needed to grow your revenue. Look for the next article in this series next week so we can increase your revenue even more. If you missed the second in this series, you can go back and read it now.
Caterina Rando, MA, MCC, shows women entrepreneurs how to be loud and proud about the value they bring in order to massively monetize their mastery. Get her free audio, Top 10 Biz breakthrough Secrets at https://caterinarando.com/register to discover how to catapult your revenue and take your business to the next level. Visit www.caterinarando.com for more about Caterina and her programs. Caterina can also be reached at firstname.lastname@example.org and by phone at 415.668.4535.