Entrepreneur
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By Andrew Neitlich

Back in the Saddle

By Andrew Neitlich
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Well, some time in my schedule has unexpectedly freed up and I’ve re-committed to blogging for Sitepoint. Your kind words during my last blog were a factor, and I appreciate your support. And thank you to Sitepoint management for their support as well. So let’s get back into it.

Today let’s discuss a case study presented by a consulting client of mine.

He found that 20% of his design/development business was dedicated to small clients, while 80% was dedicated to bigger business. He hired someone to take on the smaller clients, but was finding that his service was slipping as more and more of those clients came to him. What should he do?

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My advice:

1. He has a good problem, not a bad problem. Too much demand is a good thing and presents many opportunities.

2. Every professional, if they grow their practice well, reaches a point where they have the opportunity to move on to bigger clients or raise prices.

3. Providing bad service, even to smaller clients, is not a good idea. Word spreads fast, and will reach bigger clients.

4. I suggested to him that, since he has wisely hired someone to handle the smaller clients (leverage for him, assuming he makes a profit), he should keep that business and raise prices. That will reduce demand, improve profitability, and — with fewer clients to serve — his service to clients.

5. He should make sure he provides his employee with a consistent set of standards and processes to delight those clients.

6. He should refer any former clients or prospects who don’t want to pay higher prices to competitors, either with a referral fee or without. The key is to send competitors less profitable clients, leaving more room to take on the good ones.

7. He should focus on the 80% of his business that is made up of larger, more profitable clients. What’s his niche? How can he get more leverage on his time there? How can he dominate his niche?

Any other advice, or challenges to what I’ve suggested?

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