One of the biggest issues of small service businesses based on one person’s talents or expertise is just that the business leans on the talents and expertise of just one person. For product-based businesses, growing profits is comparatively easy such businesses can expand by exporting or opening more branches, just to give two examples. But if you have a service business, there are only so many hours per week you can work. Only raise your hourly or project rate so much before you price yourself right out of the market. Here we will discuss service business revenue models and profits:
This means your service business has a profit vault that may not allow you to make the income you need. Find the best local service provider for free
How can you break through and grow your service business’s profits? The answer is simple. Change your service business revenue model & profits are no longer dependent on you.
How Can You Scale Your Service Business at a Higher Level?
The primary goal of a service business is to help customers achieve their desired results. While scaling up is important, it’s also important to make sure that the “customer experience” remains the same.
To scale your service business at a higher level, you must first work out what you do well and make sure that you get it right for your customers. Then, you can start looking for ways in which you can scale up through different channels and different approaches.
Some people say that scaling up is all about marketing, but it’s not true: there are many other ways in which businesses can scale up without spending too much on marketing or advertising. The main point here is to be data-oriented and understand what works well for your business model!
Scaling your service business is the next evolution of your business. It’s the path towards more sustainable growth and more profit for your company.
One of the main reasons why people are getting out of service businesses is because they can’t figure out how to scale them at a higher level.
This means that their expenses are skyrocketing, they’re losing money, or they’re even feeling overwhelmed just trying to keep up with demand. What’s wrong? Well, many times it’s because we’ve been fixated on a long-term goal and have focused on building the wrong infrastructure to get there.
Best Services Business Revenue Models Today
Many services businesses find it difficult to understand which revenue models are best for them. This is because they need to balance the costs of rent and staff.
The top three revenue models for services businesses today are:
1) Varies with company size – price per unit, 2) Fixed monthly fees, 3) Variable monthly fees
A good example of a business that uses the fixed monthly fees model is a personal trainer. The business sets up a fixed amount for each month that clients pay and pays the trainer for each session or program completed by the client.
The variable monthly fee model is best used by businesses that offer services like creative writing or translation work. In this case, clients can set up a contract with the business based on how many hours or words they have translated or written.
Here are Some Service Business Revenue Models & Profits:
It is not confirmed that a small business has to be a product-based business or a service business. And for many small businesses, selling products that relate to the services they provide is natural.
The carpet cleaners sell stain remover products. Veterinarians that sell pet food. Look at the businesses around your community and you’ll see examples all over the place. Add the right products and your profits could increase aggressively
Be sure to choose products that relate to adding the services you provide. Selling separate products doesn’t work.
Hire and Train
This is another clear way to change the revenue model that many service businesses have used successfully. One person can only make so much money, many people doing the same thing can make remarkably more money.
If the service your business provides can be taught to others or is a talent that can be hired, hiring or training can work very well for you. For example, if you are a designer, you could hire other designers, allowing you to expand your client list. Or think about the carpet cleaner again for a moment. It would be easy for him or her to train employees to provide the same service.
Never hire without training. Even creative types need to be trained in terms of house rules and your business’s culture and standards.
Productize Your Service
By taking the service you provide and turning it into a product package, you free yourself from charging by the hour and relieve clients of their fear of hourly rates stacking up constantly as a project drags on.
A business person might want to have a business consultant create a business plan for them, for instance, but be worried about the expense of paying the consultant by the hour. But paying a flat fee for the consultant’s business plan package makes having the consultant create a plan more attractive and affordable and gets the consultant a sale she otherwise wouldn’t have had.
Be sure to develop products with your target audience in mind and be sure to thoroughly test them before marketing them.
Change Your Market
Right now, there’s excitement being made about differential pricing. But differential pricing has existed since the first human being made a sale; different people have always been willing to pay different prices for the same thing, so there have always been barred markets from low-end to high-end. Walmart and Holt Renfrew both sell clothes but at very different price points.
Take a close look at your market you might be allowed to change your revenue model by moving up to a higher price point. And don’t limit yourself to thinking only in terms of a business-to-consumer business model consider changing to a business-to-business or even a business-to-government model. Govt. in particular, are famous for paying more for products and services than other potential clients.
Selected clients often demand upscale surroundings. You may need to redecorate or even move your office if you have one.
Just as markets have marbled that have different price points for services, so do professions. And those marbled can mean the difference between being paid as a lowly poke and being paid like a star. Who would you rather be; the poorly paid public defender or the glamorous defense attorney that people are willing to pay huge sums?
There are many professions where you can move from one to another. The barber can become a hairstylist the masseur can become a massage therapist; the writer can become a content developer. Titles matter when it comes to fees. Repackaging yourself is not just a matter of changing what you call yourself, of course, it may also increase celebrity.
Repackaging, like rebranding, has to be complete. It may involve sweeping changes such as relocating so be sure you know what repackaging will involve before you do it.
Sell the Maintenance as well as the Service
Think how much more income you would have if rather than paying you to do one thing, your clients or customers just kept paying you. That’s what this revenue model is all about. For instance, if you are a web designer, you could offer the service of maintaining the website with monthly or annual fees, instead of just designing a website for someone.
Or if your business is installing drenching systems, you could also offer a maintenance service to your customers that would involve turning off the system for the winter and turning it on in the spring a truly brilliant idea because it would also allow you to check the system over twice a year and spot any repairs that needed to be made.
Become a Franchise
If you are operating a successful business that can be duplicated to allow others the same likelihood of success, franchising your business can bring in big bucks. But before you start figuring out how much you can charge for each clone of your company; you should read how to franchise your business to see if franchising is a workable option for your business. Franchising isn’t just a matter of opening up branch locations what you’re selling is not your service business but your business system and not all businesses are suitable candidates.
We recommend looking at PnaPna.com which has a PnaPnaCleaning.com variant specifically designed for cleaning service companies. They offer a 14-day free trial; no credit card is required with a 60-day money-back guarantee. They have a lead generation system, a digital marketplace where you can advertise your business for free. A free integrated website where you get a free web order form from your clients and the orders go straight into the software for Employee monitoring, time management, payroll, etc. The system allows collecting payments online or on job sites. You will save one full employee’s annual salary, to do all these tasks automatically.
The company will also specifically design any feature that may be very unique to your company. The owners of this software company have been in the field service business for decades and know the issues of small to medium size field service companies. Good software is an asset that will reward you many times more than the investment. They have a lifetime subscription for a one-time fee of $295.00. Even if you do not buy anything from PnaPnacleaning, you can avail of their free-for-life subscription and free advertising in your marketplace on their portal.