Building an IT consulting business and a portfolio of clients takes time. Even established IT businesses have their ups and downs as clients come and go. However, there are ways you can improve your cash flow more quickly as you grow your client base. The trick is determining where to start.
Implementing one, or all, of the following six strategies can help your business gain new clients and improve cash flow based on the current state of your business, regardless of whether new clients are on the horizon.
If you feel you’ve exhausted your personal network of potential clients or you want to expand your pool, referral programs can help you build your network and capture new IT accounts. Have your current clients, new and old, refer clients to you and offer them incentives for doing so (like a 10% reduction from their monthly bill for each month the client they referred stays on board). If you’re short on clients, don’t be shy about asking lost prospects for referrals too. If you’ve recently met with a potential client who decided they wouldn’t be a good fit for you, ask them if they know of any other businesses who may have a need for your services and if they can put you in touch. What makes referral programs especially great is that most of the upfront work of reaching out to potential clients is done by the person doing the referring, thus saving you time and allowing you to improve your cash flow without taking away from your typical IT work.
As an IT consultant, you sell products and services you believe in to your clients every day, whether they’re clients who are just starting out or those who are in need of an upgrade or less costly service. But did you know you can make money anytime they take your advice and sign up for a product or service you suggest through reseller programs? If you know where to look, you can often find companies who will offer you incentives for referring new accounts to them. Reseller programs are very similar to referral programs, only you’re the one reselling the company’s particular services. Joining a reseller program can help you earn cash for something you’re already doing anyway, making it an easy way to help your consultancy business make more money faster. Here’s one example of a reseller program that will allow you to earn, to get you started.
Carefully document project scope
Projects can quickly and easily go over budget when miscommunications arise. It’s common for clients to have overblown expectations of what they’re getting, without even realizing they’re doing it. This is most often the case when your clients not technology experts — and most of them generally aren’t. To prevent the types of miscommunications that can catapult your project out of scope, you should create a project plan and review it with your clients so you’re all on the same page before getting started on any project. This will help your clients better understand what’s involved, along with the value they’re truly getting, so that they don’t call you expecting more than what you understood was agreed to.
Documenting project scope will also help you capture many of the costs you’ve been missing out on. We often look at the bigger picture and forget to look at the smaller costs like shipping, travel time to and from projects, and other the other miscellaneous fees that can add up and decrease our profit margins. By documenting project scope, you can save yourself from having to eat a lot of these fees.
Get your billing in order
When it comes to getting paid, two things are important: time and accuracy. Billing your clients as soon as a project is finished is often the best way to ensure you’ll be paid as soon as possible. Waiting too long, or forgetting to bill your clients, can cause them to forget what was done and what they owe, which can spiral into late payments, billing questions and other incidents that increase the length of time before you’re paid for your services. However, this is not always easy to do when you’re juggling multiple other projects and are up to your ears in tasks. When this is the case, it’s often helpful to use an automated payment system like PayPal, PaySimple, and more. These systems even let you send out payment reminders when a client misses a due date.
The best time to market your business is all year long. Without doing so, you may find yourself scrambling to reach out to your network when your number of clients hits a low point. By marketing year-round, you’ll have a constant stream of marketing messages and potential client relationships already working for you to save you from severe cash flow hits. Many consultants avoid marketing because they feel it’s too time consuming, but by implementing a marketing email automation system and automating social messages with a system like Buffer, you can keep your marketing going with little upkeep. Along with online marketing, leverage your local area to attend networking meetings where you can establish yourself as a local industry expert and become the go-to IT consultant in town.
While it may seem small, being disorganized leads to lost time and therefore, lost money. By automating your own personal workflow and your client communication processes, you can spend less time deciding which task to accomplish next. Reduce call times by investing in a ticketing system, like JIRA, that will allow your clients to communicate issues to you without having to pick up the phone. You can also utilize a project management system to keep all of your clients’ main projects and tasks organized. Systems like Trello are inexpensive, customizable, easy to use, and keep your tasks organized so you won’t waste time scrambling to remember what’s left to be done for each client. Implementing both of these practices will also help you come off as more organized and professional to your clients, which will improve their satisfaction with your service and may earn you more referrals in the long run.
What practices do you implement to earn more money, faster for your IT consulting business? Tell us in the comments below!