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Times are tough but that doesn't mean that winning business has to be if you're a consultant.
If you're a hired gun, growing your business in a recession takes effort and patience but it can be done.
Here are 5 tips:
- Don't stop investing. Time, energy, money. There's a tendency to cut back on how much you invest of all three when times get tough. Often, however, the decision to cut back is driven by fear. Unless you're in dire straits, now may be one of the best times to redouble your investments of time, energy and money to win new business while others, your competitors included, are cutting back.
Cut costs by cutting clients. You might be thinking 'Huh? What is this guy talking about?' While a recession is no time to stop investing, it is prudent to cut unnecessary costs. One of the most valuable lessons I learned early on as a consultant is that there are paying clients who can cost you money. That's right: not every client or customer is a profitable one; some cost you money.
You may find that you're taking on too many clients that are burdening you (in a bad way), for instance. In my case, when I first started out I had a tendency to take on clients who weren't 'ready' for my services and needed a lot of hand-holding to get to the point where they realistically were. Even though I was getting paid, the time and energy invested in the process made these projects a 'net loss' and distracted me from taking on projects that I could have more readily applied my skills to and made a greater impact on. So I changed my habits and refocused on finding clients that I could help the most, making my efforts much more enjoyable and much more profitable.
Don't undercharge. There's immense pressure these days to offer services at the lowest price possible. After all clients are looking to save money. Sometimes that pushes consultants to make a bad decision: undervaluing the value of their time and skills. There's a fine line between offering quality at reasonable prices and offering quality at pork barrel prices and I think most of us have at one time or another compromised on the latter.
The truth is that you don't have to. Not only is it just bad habit, it can completely destroy the profitability of your services as you are forced to find more and more projects to make the same amount of money.
When it comes to my consulting business, I haven't lowered my prices a cent and I've done more business so far this year than I had done up to this point in 2008. I'm not alone; I know plenty of others who can claim the same. The reason? I'm confident that I know the value of my time and skills and I believe that my track record speaks for itself. That doesn't mean that I haven't lost projects I would have otherwise been interested in taking on because of price. But I made the decision to be the guy that a prospective client will come back to in 2 months when another consultant who quoted far less still hasn't delivered instead of the guy who walks away from a completed project feeling used and abused because I know I produced at far less than a fair price.
- Build your skill set. It's never a bad time to find a new niche. That means doing a little bit of market research to find out where there's demand and growing your skill set to meet it. If you're a developer, for instance, you may find that there's an appealing market in your region for providing iPhone or Facebook app development. Given the availability of professional training opportunities and the abundance of free and low-cost information on the web that makes self-study possible, picking up new skills that can grow the base of services you can offer to clients has never been easier if you're willing to put in the time.
- Deliver, deliver, deliver. The best way to win new clients and to keep existing clients is to deliver for them. Kind of obvious but you'd be surprised how many deadbeats there are; a healthy percentage of some of my best long-term clients came to me after another consultant left them hanging. So once you take on a project, do a good job and finish it. In turn, you'll be rewarded and may just find yourself in a recession-proof position down the road.
Photo credit: ooOJasonOoo via Flickr.