This time last year was a pretty scary time for us.
Getting The F Word off the ground had been tough; it had taken a good two years since selling my last business for it to get any traction. I love creating new stuff that no one else does, but it’s harder to launch and grow than a “me too” business (worth it though!)
But this time last year it looked like we’d got it cracked. We’d been enjoying a pretty great year of strong revenue and profits, and we had a steady stream of high quality referrals coming in. The first few months of 2016 were already booked. All in all I was happy. Finally things were coming together and my mad ideas were working!
Then it all went very wrong!
And then the Government announced one Friday evening just before Christmas that they were axing the very effective Growth Accelerator programme. Immediately. Despite the fact that the contract had another 15 months left to run.
This was a huge blow for us because almost all of our work at the time was through Growth Accelerator. Not only that, but every prospect in my pipeline, and nearly all of our work scheduled for early 2016 was for GA clients currently going through the funding process.
Overnight we lost not only our planned work for 2016, but also our pipeline and our main route to market.
Not good.
I wasn’t being naive about this; we knew we only had another year to run. I’d started working with a marketing consultant, the very brilliant Jim McLaughlin from The Directors Centre to make sure we were building our own route to market that didn’t rely on Growth Accelerator. The problem was it happened 15 months earlier than anyone could have anticipated.
I’m not blaming anyone here. I’d fallen into the trap of becoming reliant on one source of income. It’s easy to do. This could either be one large client, or your route to market, ie where your leads come from. You don’t set out to do it, but slowly over time the situation grows, and do you start turning their work down? Pretty hard to do, and before you know it you’re there – reliant.
You can’t afford to rely on any one client
I do a lot of financial strategy work with my clients, and one of the areas we focus on is making sure they’re not reliant on one key customer or one source of leads. And if they are, then a key part of the strategy is getting them out of that situation as quickly as possible. I just don’t believe you can really secure your business for the future if one client has the power to seriously hurt your business.
What does being reliant mean?
I’d certainly say that any client who makes up 25% of more of your total sales is something to be concerned about. But the true test is this – if you lost that customer would you still be in profit or would it make a significant dent in your business? And if so, would it be difficult to replace that customer?
And if you rely on a particular source of leads, what would happen if that source dried up – it might mean being reliant on one key sales person, on someone who refers clients to you, or even on SEO; I know many companies whose sales fall off a cliff when Google make a major algorithm change.
Because we help our clients build solid and long term financially successful businesses, we know this is too big a risk to take with your business. After all your business is probably all you have to secure your own future. I know mine is.
So what did we do?
Well, Jim the marketing guru started hearing from me a lot more! We quickly prioritised what few key things we believed would help us get directly out to our target clients, rather than waiting for referrals. Then basically we just took action. Sean rebuilt our website over Christmas, and we had a new marketing strategy ready to go when we got back to work in January. I started doing all the things I knew I should have been doing before the Growth Accelerator work started coming in and made life easy!
If you read my blog regularly you’ll know I’m a fan of keeping things simple, focussing on a small number of truly important things, and then doing them consistently. I have to say this approach has definitely worked for us. I was reflecting earlier back on our numbers for 2016 and although I was convinced the world was about to end, we really didn’t see any drop in income.
Don’t be afraid to get professional help
When you need to know something that you don’t know, just get help.
When our marketing strategy seemed to be working, I had another challenge. For the last year we’d been going into clients with a healthy funding package, so working with us was a pretty easy decision. Now all business funding had disappeared and I found I needed help in how to position what we do, and get more confidence in sales. Once again I went out for help and worked with a top sales coach in America, Chris Kenney, who helped me to turn things around very quickly by helping me to focus on the outcomes our clients get when they work with us.
Getting proper help is something I’ve only really done in the last 3 years. Since selling my previous business I realised I was only going to learn and get better at stuff if I paid people who knew what they were talking about and were better than me! So rather than having a scarcity approach of not wanting to spend money, I’ve developed an abundance approach of wanting to learn from the experts, and grow into the best version of me that I can. I’ve sought more help this year from coaches and consultants who know their stuff, and my business has had its best year yet!
I’ve wanted to share this story with you for quite a while, but not before I knew I’d truly overcome the challenge, and that my approach was working. I’m happy to report that our consistency this year of focussing on the important things that matter see us finishing 2016 the strongest we’ve ever been, and very lucky to be working with some amazing businesses across the country.
If you’re reading this and can identify with having areas of reliance, then think how you can plan to make your business more secure next year, and if there’s anything I can do to help, then you know where I am!