MANAGEMENT |11 MIN READ
9 Keys To Scaling A Highly Profitable Service Based Business
MANAGEMENT | 9 MIN READ
9 Keys to Scaling a Highly Profitable Service Based Business
Scaling a service based business is the fastest path to 6-figures…
… But the slowest path to a strong, highly profitable 7-figure business.
What gets you to the first $20k per month is exactly what stops you from getting to a consistent $100k per month and beyond!
If you have a service based business, you already know scaling a business is hard – to say the least. You know about the obstacles and difficulties, but you also know how BIG the potential and opportunities are.
You’ve already done a great job scaling a professional services business to six-figures.
You're well on your way to building a world-class team.
Needless to say, you have no plans to walk away now…
And the good news is, you don’t have to.
At 2X, we primarily work with B2B service based businesses, where we help them scale from six to seven figures through our 2X program (guiding them 1-on-1 through our 2X Formula).
I’ve seen firsthand how amazing a service based business can be. I’ve built them myself, and I’ve helped dozens of clients scale theirs.
So we know what works here at 2X…
But we also know what does not work…
And it kills me to see so many smart, talented CEOs struggling to scale their business model. That's why I put together these 9 Key Tips we use with our own clients to ensure they scale quickly, and effectively.
And this is important… you NEED to not only scale your business to seven figures, but do so:
- Quickly …
- Effectively …
- Without you having to be a superhero anymore.
With the correct processes, you can literally double your business in less than 90 days!
(In fact, most of our clients much more than 2X in 90 days.)
In today’s article, I’ll show you what these right processes look like, and share 9 Key Tips that will show you exactly how to grow a service based business to the next level so you can:
- Work “on” your business and properly manage it (instead of being stuck inside it, as a glorified employee).
- Build a world class team and culture (so you can stop doing all the work yourself, or worse… micromanage your ineffective team).
- Systemize your Operations (so you free up your own time (and your teams), allowing you to work on new, innovative ideas). And effectively…
- Make MORE money in LESS time (which is why you started your business in the first place, right?).
So if you own a service based business that’s built a solid foundation, has a growing audience, and you’ve already grown to six-figures… but you now find:
- You’ve hit a plateau, and your growth has stalled …
- You’re working harder and longer than ever, but you feel like you’re slipping behind …
- You can’t get the most out of your team, and you don’t have the time to fix this …
… this article is for you, because we have 9 Key Tips that will show you how to scale a service based business quickly and effectively.
Let’s dive in, although if you prefer to watch, check out this training video I recorded.
1: Define the Rules.
‘Scope Creep’ kills off more service based businesses than anything else. You begin by offering a defined, specific service to a client, but then over time you give them more and more.
Do not do this.
This will KILL your business.
If you want to win at this game, you need to Define The Rules.
And then… stick to these rules!
This is why we ALWAYS begin with strategy when working with a new client at 2X.
You always have to begin with The Foundation, and define the rules so you know how to play the game.
- What do you offer, and (just as important) what do you NOT offer …
- Who is this for, and who is this not for …
- How will this help your client, and how will this not help them …
- What’s included as part of your service, and what is NOT included …
Both you and your client need to enter into a project with defined rules, so you both know what’s at stake.
Fail here, and fail at scaling your business… period!
I learned this the hard way when building my first service based business, Epic Launch. We allowed for so much ’scope creep’ it cost us a lot of money and time (and hurt relationships with some great clients).
I remember one project with an author that we thought would take 45 days, but ended up taking six months because we kept saying yes, and we kept offering more and more.
We ended up not only NOT making money on those types of deals, we lost money in labor costs, and missed out on 10’s of thousands of dollars in opportunity cost.
Point being: Not defining the rules is EXPENSIVE.
Once we defined the rules (and stuck to these at ALL times), our projects came in on time, and on spec — today, we’ve fine-tuned this process at 2X so we deliver exceptional results at all times.
2: Start FAST and create a Great Impression.
In their bestselling book ‘The Power of Moments’, Dan and Chip Heath talk about how important it is to create meaningful, memorable moments that build trust between you and your customer.
The best way to achieve this is to start FAST and create a great first impression.
And since you have a service based business, you have an amazing opportunity to do this, because each time you work with a new client, you have to onboard them.
This onboarding process is “THE” place to create a memorable first impression.
At 2X, we place a lot of focus into our onboarding process. We have a 90-Day Program that provides a lot of value throughout, but we go all out during the first 10 days to create meaningful, memorable and stand-out moments.
- We send each new client a welcome package with some gifts…
- We have several, in-depth 1-1 calls…
- We offer constant, hands-on communication …
We build trust and rapport, and we start fast and make a killer first impression.
So ask yourself:
- What can you give your clients that goes above and beyond?
- How can you blow them away with unexpected, memorable value?
- How can you make your first interactions stand out in a BIG way?
If you're serious about your business scaling strategy, stop right now and ask yourself this question:
“How we start fast and make our first impression count, instantly confirming that our clients made the right decision to choose us in the first place?”
3: Turn A LOT of people away.
You have to say no to people. If you’re don't, you are working with FAR too many people!
It’s easy to try and please everyone, and trick yourself into thinking you can.
But the truth is, you can’t.
When you're expnding a service based business, you need:
- ONE Audience …
- ONE Offer …
This aligns with ‘defining the rules’, ensuring you’re specific about who and how you can help.
But I get it… it’s scary to say no to people and commit to a niche. I’ve been there myself. But it’s absolutely essential if you want to scale your service based business.
In fact, once you start saying NO to people, you make your life A LOT easier.
Again, this is something I experienced when growing Epic Launch, because in the beginning we tried to help far too many types of authors.
But once we niched down and committed to self-published, non-fiction, business authors… life became a lot easier — and we started to make some real money (and scaled the business month-on-month).
We’ve taken these lessons into 2X, because we have ONE avatar and serve them with ONE core offer.
And although we niched down and turn a lot of people away who we don’t believe we can help create transformational results, we have still scaled from ZERO to 6 figures per month in just 6 months!
And it only happened because we know who we can and can’t help.
The truth is, if we can’t create amazing results for someone, we don’t want to have them in our program — it doesn’t serve them, and it doesn’t serve us.
You need to have the same standards when scaling your service based business…
… an offer that blows them away with value and transforms them into raving fans (which is the best way to grow, scale and market your business in the long term — but more on this later).
4: Become Addicted to Client Feedback.
As a business owner and CEO, you spend a lot of time inside your own head thinking about the “big picture”.
This is great, and seeing as it sits at the foundation of our 2X Formula, we believe you need to focus working ‘on' the business instead of ‘in' it.
BUT… and this is REALLY important… just because you’re working ‘on' the business doesn't mean you have all the answers. And getting caught inside your own head like this can make spotting what is and isn’t working difficult.
Which is why you NEED to both get, and LISTEN to client feedback (all the time).
How do you do this?
You ask them, of course!
It blows my mind how few businesses actually ask their customers what they think
(especially service based businesses).
ASK THEM! At 2X, we have both a 30 day and 90 day survey we ask every one of our clients to fill out, asking for their feedback on:
- What they like…
- What they don’t…
- What’s missing…
- What they would like more of…
- What impact our 2X Program has had on them so far…
- What specifically has created the biggest results for their business…
This helps you build an NPS (net promoter score) rating for each client, which is an index measuring the willingness of your customers to recommend you in the future (on a range from -100 to 100).
Because here’s the thing… no matter your business, your clients are at the center of it.
An NPS rating helps you place them at the center of what you do, at all times.
It takes their feedback, and allows you to base your future decisions and ideas around this. In essence, this rating gives you everything you need to provide a better service to the people who matter the most.
This is what we do in 2X, and it’s helped us consistently improve our offer, marketing and fulfillment because they tell us what they want — but more important, WHY they want it.
But, again, we have to ask them.
And for each question we ask in our survey, we also ask a follow-up question….
- What do you like about our 2X Program?
- WHY did you choose that answer?
These follow-up questions are key because they help you figure out WHY. This takes your NPS rating to the next level, not only understanding what to do next, but WHY you should.
Before long you can fix your gaps and double down on your strengths, providing an ever-improving service to those you serve.
5: Go Niche until you OWN a Phrase.
If you want to become the “go to” solution for your audience, you need to be ‘top of mind’, all the time.
The best way to achieve this is to… OWN A PHRASE!
I first realized how powerful this is when building Epic Launch, because we intentionally owned the phrase, “book launch.”
Everything we did focused on this phrase… I’m talking:
- Marketing …
- T-Shirts we wore …
- Copy (both inside our marketing, and sales pages) …
- Program names …
- Talks / Events / Networking …
- Internal communications and team meetings …
Before long, anybody who had a friend who mentioned their book launch – and they were a self-published, non-fiction, business author – would say, “you need to speak to Austin at Epic Launch.”
This works hand-in-hand with the importance of saying no, and niching down into ONE audience and ONE core offer. Think about what they need and how you can help them, and the specific pains and problems YOUR potential clients are having…
- What phrase will help you attract the right people?
- What phrase is both memorable and relevant?
- What phrase creates a positive association between your core audience and core offer?
Own a phrase that connects you with your ONE audience, and you’ll quickly become the only solution they think about or need.
This is what sparks positive, organic word-of-mouth — which is the most powerful form of marketing there is (again, more on this soon…).
6: Build a Recurring Revenue Model.
We see this all the time with our clients at 2X, and it’s one of the biggest mistakes a scaling service based business can make.
Most services based businesses think they have to build their model around one-time projects. The problem with this is that acquiring a new customer:
- Takes time to nurture the relationship into a sale…
- Costs (a lot of) money to get that customer on board (marketing, etc.)…
- Has a high churn / low repeat customer rate…
One of the keys to success is having a recurring revenue model that keeps the same customer coming back again and again (cutting down on churn rates, increasing lifetime value, and lowering your acquisition costs).
Just look at Amazon, and how (and more important, WHY) they have placed so much focus into their Prime Subscription service in recent years.
It’s estimated that ‘Prime’ subscriptions add just under $13 billion to Amazon’s top line, and it’s expected to rise to $18 billion by 2020. This is money they know is coming in at the beginning of every month, which makes strategizing and forecasting a lot easier.
So you see… recurring revenue is where a service based business goes to shine, and no matter what your service is, there's almost always a way to create recurring revenue (seriously… we have yet to work with a client at 2X who couldn’t create one).
Take one of our recent clients, Brett and Victor, who had got caught in feast or famine mode.
Not long before joining our 2X Growth Program, they did a launch that created $50,000 in under a month, but then went back down to near zero the next month.
So we helped them create a strategy that focussed on recurring revenue, and in under 90 days they went from under $10,000 of recurring revenue each month, to more than $30,000!
This took their business to the next level, because they began each month knowing they could cover their expenses before doing any of the work. This allowed them to reinvest both their time and money more strategically, meaning they continue to grow month-on-month-on-month.
7: Master the Greatest Source of Marketing for a service based business (hands down!).
Want to know the secret to creating a successful, scalable service based business?
It’s simple… create RAVING FANS!
And how do you create raving fans in a service-based business?
Well first you need to:
When you achieve this, your service based business will grow and scale without you having to spend time or money on marketing. Your raving fans will continue to hire you (recurring revenue), but more important…
They REFER you to those they know.
And honestly… REFERRALS like this are the most effective form of marketing or sales.
- They come to you “warm” and with an element of trust…
- Meaning on average you will close more of your leads, quicker…
- They are also willing to pay more, because they trust you…
- And they tend to stay longer and are more likely to become raving fans themselves…
Why? Because your customers are people who tend to know and hangout with people similar to them (similar pains, similar businesses, similar outlooks, similar stages in business…).
So if you target ONE avatar and turn them into raving fans… they will likely refer you to other people who fit into your ONE avatar.
It becomes an epic cycle that feeds itself, but it all comes back to YOU and your fulfillment, and ensuring you blow your customers away with insane value and service.
So if you want to scale your service based business quickly and effectively, build a tribe of raving fans.
ASK THEM to refer you or introduce you to someone.
ASK THEM to share your message and promote you.
ASK THEM… because so few businesses actually ASK.
We recently helped Bill, one of our clients at 2X, do exactly this.
Bill already runs a multi-million-dollar business, and on one of our calls we suggested he reach out to his existing customers and just ASK them if they could refer anyone to them.
Within a few days he received over $10,000 of new profit, all because he sent a few emails and ASKED the question. This is some of the easiest money he will ever make, and it’s set to add six-figures to his bottom line this year.
8: Make YOU Replaceable.
Last year I sat around a table of successful entrepreneurs…
Five of us were around the same level, but two of the guys were way ahead in term of success and business size. And at one point we went around the table and answered this question:
“What’s the number one thing that’s holding you back at the moment?”
One person said cash flow and another said acquiring customers, and we all had our own excuses.
But then it got to the two most successful guys, and they both said without hesitation,
“ME! I’m the bottleneck.”
This taught me an incredibly valuable lesson… The biggest bottleneck (almost without exception) is the CEO.
The thing is, so few business owners and CEOs do this. They get caught up in their ego, wanting to ensure they’re irreplaceable (after all, when you work for someone else, this is your goal).
But as a business owner, you have to let go!
You have to make yourself replaceable, otherwise you’ll get caught up working inside the business (instead of “on” it), and micromanage instead of delegating and leading your team.
You do nothing but create a job for yourself, and we see this all the time when working with new clients at 2X… This is why the first thing we do is focus on the vision, strategy and business model.
The only way you will ever scale your business is if you remove yourself as the bottleneck, and build a service based model that can scale and grow with or without you.
- This is what allows you to build a world class team.
- This is how you can turn what you’re good at into GREAT.
- This is where you create a culture that drives innovation and growth.
- This is what allows you to sleep better at night, and enjoy life!
By making yourself replaceable, you turn focus on process and operations — and a world class team that not only does the work for you, but better than you.
This is how you scale, especially a service based business that relies on a lot of personal touch points.
9: Master your numbers inside and out
Finally… Once you remove yourself as the bottleneck in your business, it frees up the time you need to work “on” the business and focus on this all-important aspect (possibly the most important of all) …
As CEO, your decision making determines everything — but you can only make the right decisions if you understand the numbers and dial them in.
And the first time you do this… it may surprise you; it may scare you; it may open your eyes!
It doesn’t matter!
As you evolve from hustling entrepreneur to successful CEO… you need to know your numbers!
You need to:
- Track your (and your team’s) time …
- Track your financials …
- Track your core metrics and KPIs (marketing and sales) …
And possibly most important of all, you need to track your income streams by channel, and determine how profitable each one is.
But as soon as you do, you can double-down on what makes you the most (profitable) money, and cut down on costs, waste and everything else in your business that isn’t bringing you a solid ROI.
Seriously, you need to become addicted to the numbers. The CEOs and business owners I know who are, are the ones building the business that are scaling the fastest.
Once you know your numbers, your life becomes so much easier… leaving you with a:
- Fast-Scaling… Business!
But until you dial-in your numbers (and implement the other 8 Key Tips we talk about in this article), you’ll continue to struggle to grow and scale to the next level, and you’ll remain caught in “hustle mode” where you’re working harder and longer, but getting less and less in return.
If you’re just starting out, you don’t need to worry about these 9 Key Tips, because as I said earlier, growing a service based business to six figures is possibly the easiest of all…
BUT if you want to scale from six-to-seven figures (and do so quickly and effectively) these are the tips you need, and the best place to start is with this final tip… to know your numbers!
We recently created a guide that shows you the 10 KPIs you NEED to know about at all times, and that will help you kickstart the rest of the tips we talk about in this article.
In my opinion, it’s the best guide we’ve ever created, so grab your copy here >>
If you have a service based business, the sooner you implement all this, the better! We come across so many business owners and CEOs going about it all wrong, so don’t worry because you’re not alone.
Fixing this (and doubling your business in less than 90 days) is A LOT easier than you might think.
But don’t take my word for it… Here are a few people we’ve worked with recently at 2X who have seen just how easy all this is….
Thomas and Cathrine have …
Doubled their six-figure business in recent months, while travelling more than ever and working less than they ever have before. They’ve dialled in their numbers and now focus on what works, and they continue to grow month-on-month.
Then there’s Brett and Victor…
Who have grown their service based business by 3.6X in under 90 days, all because they have got their positioning down and started to reinvest their money and time properly.
And there’s Willem, too….
Who has redefined his entire business and become the “go to” expert in his industry, because he no longer competes on price, and is instead solving a real problem for a specific type of person.
All these people have taken their services based business to the next level in less than 90 days, because they’re no longer stuck working inside their business.
They dialled in their numbers, optimized their business model, and are now making the best decisions for THEIR business.
You can too, although we appreciate this article may have created new questions about how to make a service business scalable…
We would love to answer them, so if you’d like us to help break down your own service based business and show you specifically how to use the 2X Formula for YOUR business, schedule a free strategy session now.
You can more than double your service based business in the next 90 days, and we have the proven formula for it. It begins with this free call, so let’s see how we can help you >>
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