(Including the Top 5 Leverage Points to Grow Your Service Business—FAST!)
Service Industry Areas of Expertise:
Maui team to add in specific service industry areas that we specialize in/have coached before. Ex: Real Estate, Medical, etc.
Why Owning a Service Business Often Leads to Long Hours and Owner Burn Out!
Have you ever felt like building a service business just wasn’t fun anymore? Like somehow it had turned into work? Or worse, like it had turned into a “job”?
Having coached so many service business owners and CEOs ourselves, not to mention owning multiple services businesses, we understand.
It’s one of the top 3 reasons so many of our Business Coaching clients asked for our help to grow and develop their companies.
Whether you’re working business-to-business or business-to-consumer, service business owners have one of the highest incidents in getting caught in the Self Employment Trap™ of any category of business owner.
Why? Because of the high expectations of your clients combined with the difficulties in finding and managing your workforce to deliver up to YOUR high standards.
This is a recipe for you, the business owner, to be forced into a role of catching many last minute mistakes or “fires” that you have to rush in and fix—often at a high price to your family and personal life.
Here’s how one of our Business Coaching clients Mark Huha put it (Mark and his wife Dianna own and run a service business located in San Diego for close to 20 years):
“We used to love this business, but just feel burned out now. It feels like we’ve built a job for ourselves. And what’s worse, it’s a job where we have all the overhead and stress and responsibility too!”
If you’ve been in your service business for a while now then we’re sure you understand exactly what they were saying.
The real challenge that Mark and Diana faced wasn’t that their business wasn’t a good one—it had supported them and their family comfortably for years—it was just that they had maxed out what they knew about how to build a service business.
Mark and Diana knew how to run the day-to-day operations of their business, but they didn’t know how to grow and develop it as a business. No one had ever taught them how to do that.
Over their first year in the executive coaching program, we helped them shift their mindset from doing the day-to-day “job” of their business, to building it as a true business.
We helped them create a better strategic plan to empower business growth in the service industry. We helped them build better systems, intelligently grow their employees, and develop strong internal controls to ensure they were on top of all their business processes necessary for success.
For them it was a breath a new life into the company.
And their results? They speak for themselves.
That first year they grew their service business from $775,000 a year in sales to approximately $1.1 million a year. That was over 40% growth in just 12 months! (Considering that prior to working together they averaged just over 4% growth per year you can see the difference their new approach had on their company!) Plus their net profits went up 104%!
Mark Huha, from San Diego, grew his sales by 44% while at the same time reducing his stress and hours!
Part of these results came from better strategy – helping them to focus on fewer, better areas of their business and market that made the biggest impact. (Think of strategy as knowing the “what to do.” Generally it means both determining what things to focus on, and what things to stop investing company time and money on.)
Part of these results came from better tactics – knowing exactly HOW to do the “what to do”. (Tactics are your concrete action steps to implement your strategy.)
Part of these results came from having for the first time ever in their business lives the support and accountability structure to make sure they were consistently DOING the “how” and “what”.
The best part for Mark and Diana was how much more enjoyable their business had become for them. It was vibrant, growing, and they had the internal systems, team, and controls so that it was markedly less reliant on them.
What about you? Do you own and operate a successful business that’s got you feeling a bit burned out?
Here are the top 5 leverage points to building a service business…
The Top 5 Leverage Points to Building a Service Business
Over the years we’ve worked with over 22,000 service businesses through our business coaching service, helping them to overcome the typical obstacles that keep so many of these labor intensive companies small. Here are the top five leverage points to grow your service business and break out of the Self Employment Trap™.
This is where the owner of the business is so consumed by his or her day-to-day management of the business that they don’t have the time or space to step back and focus on building a service business as a business. In essence they have built a self-employed job, not a business.
Is it any wonder that so many of these service business owners end up 5, 10, 20 years later totally burned out—hating the very business they once loved. They feel trapped. The business generates the income they need to support their family and their lifestyle. But because of how they have gone about building it, they can never really leave their business.
Leverage Point #1: Develop a better SYSTEM to hire and manage your team and workflow.
It’s not enough to be able to find good people one-off. People’s lives and motivations are complicated, and your business needs the stability of a solid system in place to find, hire, orient, and manage your team.
Remember, when building a service business you’ll be hiring and managing staff forever—it is a core part of your service business—and as such you need to make it a real strength of your company. And this means systematizing your knowledge of exactly how to do it.
Further, you need to systematize the work itself so that your team gets better results with less time and effort.
We’ve discovered with our service business coaching clients, that when we help them to implement systems and sound business controls, their team enjoys more success, retention increases, and the cost of replacing any one team member drops dramatically.
Leverage Point #2: Creating growth through better and more consistent lead generation.
Too many service business owners improvise their lead generation and do it haphazardly. When they see a lack of sales they scramble to generate fresh leads. Then they get caught up in managing the business they bring in. Because they can’t count on a consistent lead flow it becomes almost impossible for them to effectively manage their cash flow and growth.
If you are truly serious about building a service business you need a reliable baseline system for consistently generating a steady stream of qualified leads into your business.
This is exactly what we do with our Business Coaching clients.
Take the example of Kelly Fabros, a long term client who built up two very successful businesses (the first a health products company and the other a commercial real estate business—both of which she still owns as Level Three businesses.)
She had just purchased a Middle Stage Level Two mail center with the intention of scaling to multiple locations.
When she took over the business there were no marketing systems in place of any kind. Is it any wonder she was able to buy the business so cheaply? There really wasn’t a business, just a little bit of inventory, a physical location, business fixtures and equipment, and some customers who were in the habit of using the location for shipping and notary services.
Kelly’s been implementing the real estate business coaching we’ve given her on creating and testing various lead generation activities, and in the first 6 months working together she’s found three solid lead generation systems that reliably bring in new business.
The net result? Her sales are up over the old owner by over 50% in the first 6 months working together!
Building a Service Business:
Kelly Fabros increased her sales by 50% in her first 6 months in the business coaching program!
Leverage Point #3: Creating growth through a more effective, more reliable, and more replicable sales process (Lead Conversion)!
Let me ask you a tough question: Does your business have a systematized and proven lead conversion process that reliably helps your business convert prospects (leads) into paying customers and clients?
And if you answered yes to the above (a real rarity for service business owners in our experience), is that system designed so that other people on your team can and DO sell as well as or better than YOU the owner?
This is a tall order, we know. But a doable one—IF you either know how to do it yourself from your past experience OR if you get professional coaching from someone who’s done this before!
This is one of the biggest reasons so many of our Business Coaching clients come to us—to get our help in designing, implementing, and refining a proven sales system so that they can finally scale their sales efforts.
Again, as noted above, the real goal of all this is predictable sales volume.
One of the biggest pain points we hear from new clients is that their business is either feast or famine. Of course it is for their service business. They scramble to find business until they are full. Then they shift their energies over to doing the client work and meeting the demand of all this new business. Then they finish up a lot of this business and realize that they don’t have any new business coming in so they scramble again to find more client work. And on and on this cycle goes.
It is incredibly difficult and risky to scale your service business staff when you can’t count on a steady flow of business.
Variability is the bane of the growing service business. And you must find a way to systematically bring in a consistent and growing stream of new and repeat business. This is one of the most important secrets to building a service business.
Leverage Point #4: Redesign and systematize your work flow to increase your business’s efficiency and quality and hence increase your margins and protect your cash flow!
In most cases, your number one expense of your service business is staff. Have you strategically designed your core business processes to be the most efficient, high quality output that you can?
With our Business Coaching clients we often find simple ways to leverage technology, stronger better designed tools, and intelligent business controls to help you staff get more done with less time, effort, and cost. This brings with it huge increases to your company’s capacity and operating profit margins.
Leverage Point #5: Managing your cash flow to be able to afford your growth.
It’s time to share a hard truth—from our work with thousands of service business owners one thing has become abundantly clear — most service businesses do NOT have a well-run financial pillar of their company.
Their collections are haphazard and slow; their billing systems fail to record and bill for a percentage of their work; their reporting is too little, too late to do much strategic and managerial good; and their financial controls leave them vulnerable to theft and employee fraud.
The good news is that these are simple fixes that we can help you with. This includes:
- Implementing a clear collections system with solid tracking;
- Creating billing controls that have at least two redundancies to ensure that all billable work has in fact been billed for; instituting a regular weekly, monthly and quarterly routine of managerial and strategic level reviews of the numbers;
- Implementing sound financial controls to make it 100 times less tempting for fraud to take place.
- Implementing systems to better manage cash flow and control expenses.
The net result of these efforts is that you will finally have a sound financial base from which to safely and successfully scale your service company.
You need cash to grow. And most service businesses are stuck settling for less than they can produce simply because they are cash starved—with poor financial systems the most common cause of this lack of accessible cash to fund growth.
To summarize, owning a service business is tough, and managing a service business day-to-day can be even tougher.
For many small business owners in the service industry, building a service business can cause ongoing stress and ultimately lead to burnout.
Having spent years developing and executing our business coaching program to help service business owners like yourself, not to mention owning multiple services businesses, our experts at Maui Mastermind understand the ups and downs of scaling a business within the service industry.
If you’re tired of letting your service business run your life, we’re here to help. Hire a trusted service industry coach today to help transform your career journey and provide you with the leadership coaching you need to build a profitable, successful business.