By Karl Sakas
Natalia_Kollegova / Pixabay
What do you do when your agency growth hits a plateau and you feel stuck?
A client recently asked for help on this very topic. He had been running his agency for a decade—and sales were in a slump. He felt that he had a good team doing good work, and they specialized in a particular technology where they’d developed strong expertise.
He had even raised their hourly rate—in fact, it was the highest rate that I’ve seen for that particular technology level so far. But they just weren’t seeing any growth.
What can you do if you hit slower growth or a plateau? Read on—this is a long article but there’s a lot to cover to help you turn things around!
What factors lead to agency growth?
Business growth is no simple feat. There are are a lot of factors that go into helping an agency grow initially, and it only gets more complex the longer the agency is around.
Agency growth requires at least 8 things:
- Strong sales pipeline, to keep new work coming in.
- Strong client onboarding, to get new clients started smoothly.
- Strong project management, to complete the work profitably.
- Employer-of-choice reputation, to attract flow of employees (and freelancers) to do the work.
- Regularly-evolving team structure, to keep up with the need to scale the team.
- Strong culture and clear vision, to keep people on the same page.
- Cash reserves, to cover speed bumps along the way.
But what is growth? Before we can go further, we need to agree on a few terms.
Revenue vs. Profitability: What is growth?
First, let’s take a look at how we measure things. When most agency owners talk about agency growth they’re referring to revenue—and when they say they’ve hit a plateau, they mean that they can’t grow their revenue beyond a particular point.
Often, it can be more helpful to look at profit margins or absolute profits when trying to measure agency health. After all, if your revenues are flat but your profit margins are increasing, you’re taking home more money, and that’s a good thing, especially since you’re getting that done with the same amount of work.
And, of course, it’s possible for the reverse to be true. I often see agencies where profit margins decrease as revenue grows, because expenses grew even faster than revenue.
So, keep profitability in mind—but since most agency owners equate growth with revenue, let’s focus for now on revenue.
What do you do when revenues are flat? What do you do when you’ve hit a growth plateau?
Start by accepting that you’re going to have to make some changes. Whatever you’re doing now isn’t working. You’re going to have to let go of whatever approach or strategy you were using before. Once you’ve done that and you’re ready to move on, here is a list of things you can focus on to increase your revenue.
Spur agency growth by increasing your billable ratio
If your goal is to get higher revenue with your existing team, you can increase their billable ratio. What percentage of their time are they billing?
I see many Go to the full article.
Source:: Business 2 Community