Does your business model produce more money or more stress?
Business model, shmizz-ness model. I used to Poo Poo this term until I began to learn how entrepreneurs successfully thought and truly compiled their business strategies. Your business model is basically how your business makes money. For example, how you pull the prospect, turn it into a client and get a profit.
If you are in a service-based business, the most common business model is working with clients based on one by one. It has advantages and disadvantages. Upside from one-on-one model is someone paying you for your help. This is a great feeling when you see the results taken by your client from getting your advice. And it gets better when your client pays you what you value, right?
But what happens when you have a plate full of clients and you are crazy busy? Like when you can’t even stay away from your table to go to the bathroom? You don’t have time to review your profit statement, get a massage, or even on vacation. Disappointment.
If you have a full plate when it comes to clients, I will be sure you wish you no need to work hard to make the same amount of money in years and years. A better business model is to have a scale, leverage and passive income, besides working one on one with a client.
Leveraged income is when you work with many clients at a time. This is not one-to-one. This is one for a lot.
Here is an example of how leverage income works.
Let’s say you are a nutritionist and your hourly rate is $ 100 per hour. If you spend the same time and teach a class one hour with ten people pay $ 30, you just triple your income to $ 300, spending the same amount of time. It’s leverage.
Here is an example of how passive income works.
Passive income is when you don’t have to be actively involved in doing work to be paid. Let’s say you are an accountant. You are still looking for clients but you want to make money when you are on vacation. So you decided to make a workbook for people to use them.
Your upfront fee is $ 2000. This is the time you need to write it, design it, and get it for sale on your website. You sell it for $ 50. When people buy workbooks on your site, you don’t need to do anything. Automatically sent, and you paid. You drink Mai Tais in Hawaii while people buy your product. Sweetness.
If you don’t have enough clients, you need to build programs / services / products / products / products / products that can be measured and leveraged at the same time you build a one-on-one business. This is very big! OMG I wish I knew this when I started in business.
So how do you do this?
Write all your services and enter them to several programs. One-one service price for more expensive.
Create a passive product or leverage and lower prices to attract more people who might want to test the waters with cheaper products. Make sure you give a price to generate profits, not break even.
Create a line item to market items in your new business model. Consider spending at least 5% of your business income on marketing. Why? Because if you don’t, how do people know about your program or want to buy it?
In this new leverage and passive program, make them the way you paid more than a longer period of time and not just once. Repeated income is very important.