4 Simple Steps for Keeping Every Dollar You've Earned in Your Pocket New business is good but the quickest route to making more money is cutting pointless expenses and getting paid promptly for the work you've completed.
By Sam Madden •
Opinions expressed by Entrepreneur contributors are their own.
The one color that resonates with all self-employed professionals is the color green -- everyone likes making money. I'm not here to preach about how to get new business, because these days it seems like there's a new lead-generation tool popping up every week. My focus is holding onto the green you do make, so you can reinvest your dollars into your business.
1. Stop paying for leads
All the lead generators out there want you to believe that you need to pay to get business. The truth is, if you do good work, you shouldn't have to pay to get more work.
For the most part, individuals going to sites like Thumbtack and Handy are looking for the lowest price possible. Converting those types of clients into recurring, full-paying customers is tough, not to mention that the return-on-investment math never quite adds up for paid leads. On average, only about 16 percent of those paid leads convert to actual business. Worst case, you just get taken for a ride with lead-gen tools.
Go for the high-quality leads. Set yourself up on Yelp. It's free! Ask clients to write reviews after you do your work. Follow up with them if they forget. Make business cards (less than $10 for 100!) to increase your chances of going viral amongst your clients' friends. Join your local BNI chapter to have others do your marketing for you!
Finally, build your online presence on Facebook, Twitter, LinkedIn, etc. Display your personality (clients love this) and build your own brand.
Related: 50 Ways to Save Money in Your Business
2. Make yourself 'bookable' everywhere
If you call a restaurant to make a reservation and they don't answer, do you just wait around for them to return your voicemail? No, you're on to the next best option. (This analogy might not resonate anymore now with OpenTable, but that's part of my point…Bear with me.)
The same behavior, unfortunately, goes for many clients in search of service professionals. Unless you have an ongoing relationship with a client, missing a client's call or delaying an email response can be a death wish. Customers typically move on to the next best option when they are not immediately satisfied.
You want to make sure that every client who wants to book you can book you, immediately. To help them, display your schedule on your website, your Facebook page, even on your email signature. Allow your clients to schedule appointments at the drop of a hat, on their time, so they are satisfied and you keep busy.
Don't have any excuses for losing out on potential revenue.
3. Put a cancelation policy in place
It seems nobody feels bad telling you, "Sorry this is so last minute, but something more important came up."
Every business owner I've ever met has been canceled on (some much more than others). The cure is to make your job more important than anything else.
Put a cancelation policy in place for your appointments. Make your clients aware that your time is important because, let's be fair here, it is! If you get a cancelation text when you're 20 miles outside the city, en route to your client, that's a lot of time and gas wasted.
Institute and enforce cancelation and no-show fees to all clients. Collect their credit card information upfront, with a clear "For Protection Only" message. Good clients understand that this is fair.
Related: 8 Great Ways Your Small Business Can Save Money
4. No more invoicing
"So, I'll PayPal you later?"
"Where can I mail the check?"
"Can I just get you next time?"
The above three phrases are among the worst words that come out of a client's mouth. A dual emotional reaction comes over you, the professional.
Frustrated you has the urge to shout,"I want to get paid now – I deliver a service, you pay me…that's how this works!" Fearful you worries, "Oh, my god, what if I never hear from this person ever again?"
Invoicing is time-consuming but never guarantees payment. Don't be fooled by techniques such as PayPal or mobile transfers (i.e., "modern day" invoicing). These processes still suck your clients into being lazy and keep you up at night wondering when/if your payment is coming. Not to mention, from an opportunity cost perspective you're actually losing money while you wait for payment.
As soon as a job is complete, don't "follow up" for payment. Have your client's payment details on file. As soon as you complete a job, start processing that customer's payment as you walk to your next appointment. You'll save time, you'll sleep better at night and, frankly, it will even make your clients' lives more convenient (no check writing, no cash withdrawals, no reminders).
