Leverage is a new buzzword in the world of entrepreneurship, but what does it really mean? If you are a service professional you might struggle with the concept of scaling up your business. In fact, you might feel you run into a glass ceiling when you think about how to grow your business. After all, there are only that many hours in the day!
In this article I want to explore what leverage means. I will also explore various leverage strategies how you as a service professional may be able to scale your business. And what results you may be able to expect.
Keep in mind, this article specifically addresses leverage strategies for service professionals. For example how a coach or consultant might achieve business growth. Or a holistic practitioner, naturopath, or even a financial strategist to name a few. Other businesses may benefit from these strategies too.
What is Leverage?
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Consider having a big and heavy box in front of you. Bending down and picking up the box is not possible. How will you lift the box?
By using a lever from the side you can lift the box on the side where you apply the lever. The longer the lever the less effort it will be to lift the box.
In business the same principles apply.
By using a “tool” you can have a greater impact in your business and get greater results.
This “tool” can be a business strategy, a system or a process flow. In the next section I’ll explore a few of those strategies that may work for the service business.
Leverage Strategies for the Service Professional
Compared to working with your clients one-on-one, a contract arrangement with a larger organization can provide you with more billable hours per business development hour.
As entrepreneurs we all need to spend a certain amount of time on business development. Those are the hours you spend prospecting, follow-up and ultimately closing your deals. And we spend hours on serving our clients, typically our billable hours. The rest of our time is used up with administrative hours which are also non-billable hours.
The ratio of billable hour to business development will go up for contracts that are larger. You spend less time looking for work and more time delivering your work. You may also save on administrative time for handling this client.
With the same effort you can achieve greater results. This is a great leverage strategy for consultants and also coaches or advisors. Other service professionals may also be able to get contracts that provide them with stable and recurring income.
Working with Groups
If you presently work with individuals, you might want to consider adding some work with groups to your portfolio. When you work with groups, you can serve more clients at the same time. In addition, your group members will benefit from the exposure to other people with similar issues. You may need to lower your pricing for group work, however, the number of participants usually make up for that.
In this instance, for the same amount of billable hours you will receive more revenue because the number of participants goes up. Nice side effect: You make a greater impact in peoples lives!
In the 21st century most service professionals have the great flexibility to work from anywhere. If you are working with your clients in person and you are rushing around town, coming home stressed from being stuck in traffic and fighting the clock, consider if you may be able to serve your clients online. You will save a lot of time travelling around, you also save travel expenses or office expenses if your clients presently come to you. And you may experience that your online meetings are more efficient than sitting around a boardroom table.
Today there are many tools you can use to meet with your client effectively and inexpensively from the comfort of your home office. Use an online meeting platform such as Zoom or Skype as an alternative to phone.
You can even do group meetings using these platforms. I often use Zoom in my programs with my clients and it is fun to host these meetings with people from around the globe.
This is a leverage strategy I personally love. It gives me the ability to be location independent and still serve my clients in a very personal way.
A retreat can be as short as 4 hours or as long as a week and more. You might hold the retreat close to your home or close to your dream destination. You may run a retreat for one person or for hundreds.
How you structure your retreat is up to you. By bundling client hours and packaging those with additional value such as the location and activities at your destination you can make your work more fun, more transformational and also more financially rewarding for you.
In a Mastermind you have a group of clients who meet regularly (in person or online) to work on certain aspects of their life or business.
By offering a Mastermind you will have more client hours versus the actual facilitator hours. For example, you have 10 clients in your Mastermind. For each hour you facilitate your Mastermind, you deliver 10 client hours. Meaning you are growing your revenue potential for the same time you would invest if you were to work with just one person.
The additional benefit is that you typically run a Mastermind for a longer time, 6-12 months. Hours spent on Business Development have a high return. Masterminds are a great leverage strategy for coaches, consultants and advisors who help clients in a wide area of topics.
By running Online Programs, specifically those with a high component of automated services, you can achieve more time freedom for you. Yes, you need to invest the time in the creation of your program. Yet, once the programs are launched, you are predominantly spending your time on marketing the program. The delivery is partially or completely automated.
In my practice I teach clients how to create Online Programs that work for them. I don’t believe that Business Strategy is one-size-fits-all. It is very unique and the same applies to the type of program you want to create. You are the one who will decide how extensive your program is and how automated it will be. I love working with my clients, hence most of my programs have a component of client interaction included.
I’d rather have smaller programs and interact directly with my clients. That is my personal preference. With this leverage strategy the impact will depend on your level of automation.
What is your preference when it comes to building programs that are partially automated?
In a Membership Model you offer repeatable services for a monthly membership fee. The key is to get as many members as you can get and serve. Your members may receive access to your programs and resources and possibly even access to you personally – most of the time as group Q&A calls.
Memberships require well designed systems so you can serve your clients well and don’t get lost in the administration.
You will want registration and access to be mostly automated. Also the delivery of your services and the notifications need to be easy for you. Be sure to get help to set up your systems so you can handle the growth you will need to create to make this Leverage Strategy work for you.
Franchising and Licensing
For those who are well established and have always wanted to scale big! This strategy multiplies what you created in your original business by licensing it to others to run it in the same way in a different market.
This is a great model for experienced program owners who see a need for their services and want to branch out into other regional markets without having to set up a network there. Find somebody who will teach your program in the same way. You develop a licensing model around that and ultimately shift gears to find licensees rather than end clients.
This is a very advanced strategy. If you want to consider this in your business, I highly recommend working with a specialist in that field.
Most of these strategies will have a limit as to how big you can grow it. This is what we call scaleability. If we go back to our initial example of the heavy box, scaleability is expressed through the length of the stick.
For example, even if you take on a contract, ultimately you will run into a time limitation. You can only offer a certain number of billable hours to your contract client. Once you spend too many hours on contract, this can very much feel like a job – and have the same limitations as a job does.
In group work you will run into limitations too. Once your groups get too large, your business becomes an event business or training business as there will be no longer the possibility to interact with the individuals. This may result in a shift of markets.
Online Programs are highly scaleable. The more automated they are, the more scaleable they are too. As you are growing your business and your reach, you can build your business with a few clicks of your mouse.
This may sound very appealing to you. Be aware, the more automated you get, the lower your revenue per client. And for some it may not be the business you would like to create.
As you can see, each leverage strategy has impacts on your business, not only the financial side, but also the quality of your work and the impact you can make.
Which Leverage Strategy Can Work For You?
As you have been reading this article you might have thought about these various strategies from the perspective which ones you are already doing or which ones you could be doing.
Perhaps you are just at the beginning of exploring how to leverage your business. Or you have tried this in the past and not succeeded but are feeling encouraged to consider this again.
Understanding the Leverage Strategies and their impact on you and your clients are key to decide which way to take your business. I would love to help you to find out what your ideal Leverage Strategy is.
If you want to determine what the best Leverage Strategy is for your business, contact me!