No matter what industry you’re in, your clients are everything. They are what keeps your business in business.
Many small business owners are eager to take on any and all clients that come their way. They believe that the more clients they have, the more profit will come in. This, unfortunately, isn’t the case.
It is important to pick and choose your clients carefully. It is of great importance that you choose clients that will bring the most profit to your business.
How do you spot a profitable client in a line up?
This is definitely not an easy task, but once you master it, you can make more money per project and enjoy a consistent stream of work, practically year-round.
Qualities of a Profitable Client
Before you start your hunt for the most profitable clients, it’s important that you take a look at your existing clientele. By doing so, it will help you get a sense of where your sweet spot is and how you bring value. Quickly, you will begin to realize that the majority of your content come from 20% of your clients.
Why only 20%?
We want to help you understand the 20% of your clients that are bringing you profit. Here are 7 questions to ask when looking at your clientele that will help distinguish a profitable client.
1. How well do they pay and how does that compare to the market rate?
A profitable client won’t constantly wrestle you over pricing or to prove your value to them. They will have a healthy balance between their budget and yours.
2. Do they refer your services?
A profitable client will refer your services to others. When you build a relationship with one client and they share your services with others, this brings more profit to your business, without any work on your end.
3. Do they have a good payment track record?
Cash flow is KING in your business. Without incoming cash, your business sits at a standstill. You can use business factoring to get cash for your outstanding invoices, but with profitable clients, they make payments on time. Not only does this show that they care about your business, but it also shows the type of business that they run as well. Their finances come first, which is a great quality to have as a client.
4. Are you their go-to provider?
This goes hand-in-hand with referrals. If you’re apart of stable providers that they choose from, they will always bring you profit.
5. Do they take full advantage of all the services they offer?
A good, profitable client will always be aware of your business’s entire skill set, and will use it to their advantage. They will put you to work, utilizing multiple services you offer to get the best, and most accurate results for your business.
6. Are they pleasant to work with?
This is something that business owners tend to overlook. They see clients as profit and that’s it. When you take on clients, you have to consider them as more than clients. You will have many interactions this person per month, so you might as well make them pleasant ones, right? Having clients that treat you with respect and truly value what you do is very important, not only for your long term relationship, but for your profits.
7. Do you get along more than on a professional level?
Going along with number 6, you have to ask if these clients are someone that you would have in your life if not for business. The clients that you answer ‘yes’ for are those that will be the most profitable to your business.