Have You Created an Impossible Business?
C.J. Hayden, MCC

It's easy to think that any business can be successful if
you work hard enough, but there are many situations where
this just isn't so. Consultants, coaches, and other service
professionals often start a business believing that all they
need to do is charge a "reasonable" fee and sell "enough" of
their time. But unless you do the math to prove or disprove
your assumptions, you may be creating a business that can
never succeed. Here's what can happen:

- Impossible Business #1 -

My client Molly was selling her services as an image
consultant to individuals who wanted an updated or more
professional look. She charged $50 per hour, which she
thought was the most anyone would realistically pay to work
with her. In most cases, she traveled to a client's home or
went shopping with her client.

Including travel time and lunch meant that Molly could only
make two appointments in one day. The average appointment
was two hours long. So the maximum amount Molly could earn
in one day turned out to be $200. But in order to earn that
amount five days per week, Molly would have to schedule ten
different clients, all of whose schedules were able to adapt
to whatever times she had available.

This was hopelessly unrealistic. Even if Molly had been able
to make the scheduling work, when would she have had the
time to do the marketing required to land that many clients?
It turned out that the maximum Molly could really earn using
this model was about $500 per week. After paying her taxes,
she couldn't even cover her monthly living expenses.

- Impossible Business #2 -

Fred was a student of mine who worked as a software
consultant for midsize corporations. He typically charged
$75 per hour, and when he landed a contract, it often
consisted of 20-100 billable hours.

Because Fred's earning capacity was so high and he disliked
marketing, he spent a lot of money on marketing himself
indirectly. He purchased display ads in industry journals
and directories, mailed expensive brochures to large lists
of prospects, paid to exhibit at trade shows, and hired a
telemarketer to prospect for him. Fred also worked on
contracts that came through agencies, who often took 20-30%
of his earnings as their percentage.

Fred was earning as much as $80,000 per year, but he was
losing about $10,000 per year in agency commissions, and
spending $20,000 per year on marketing. In return for all
his hard work, he was earning considerably less than he had
at his last job.

- Making the Impossible Possible -

New consultants, coaches, and other professionals almost
always overestimate how much they can earn and underestimate
the amount of time and money required to successfully market
themselves. They also forget that they will have to cover
not only their living costs and business expenses, but pay
self-employment tax, buy their own health insurance, provide
for their own retirement, and allow for unpaid vacation and
sick time.

If Molly or Fred had taken the time to sit down with a
calculator before starting out in business, they would have
quickly discovered that they were on the wrong track. But
both of these businesses were able to be rescued.

Molly began selling her time by the day instead of by the
hour. She offered her clients a full-day package that
consisted of a wardrobe review and consultation in the
morning and a shopping trip in the afternoon. By charging
$395 per day and scheduling three clients per week, she
could earn more than double than she did previously.

She also began offering a monthly one-day image workshop as
a way of bringing in more income while giving prospective
clients a chance to experience her work. The workshop became
her main source of new clients, and marketing the workshop
turned out to be easier than marketing her personal
services.

Fred learned how to market himself less expensively through
networking, speaking, and writing articles. Instead of
buying booths at trade shows, he was showcased there as a
presenter, and spent time networking with the other
attendees. The same publications where he used to run ads
now ran his articles. Rather than paying a telemarketer, he
started picking up the lunch tab for people he thought could
refer him some business.

As a result, his expenses for marketing and commissions
dropped from $30,000 per year to $10,000. At the same time,
his income rose to $100,000 per year, because as his
visibility and reputation grew, his services were more in
demand and he could command higher rates.

If earning a decent living as a self-employed professional
sometimes seems impossible to you, start asking how it could
be possible. What can you change about how you are marketing
yourself, how much you are charging, and how you are
packaging your services? While it could be that success will
come if you just work a little harder, it's more likely that
you first need to start working a little differently.

C.J. Hayden is the author of Get Clients NOW! Thousands of
business owners and salespeople have used her simple sales
and marketing system to double or triple their income. Get a
free copy of "Five Secrets to Finding All the Clients You'll
Ever Need" at http://www.getclientsnow.com