0 Paying for Training Coaching and Marketing

In this sequence, I’m exploring the consequences of making money for the heart-based or values-centred business owner.  Last Wednesday, I covered earning, saving and giving money and business overheads and costs recently. So, today I focus on training coaching and marketing services.

Support Services in the Local Economy

There are thousands of support service offers online and in-person.  One decision you need to make is the extent to which you use local services.

In-person services mean face-to-face or online meetings between a coach or consultant and their customer.  Face-to-face meetings are popular, although sometimes online meetings are an advantage, for example if you are working on a website together.

In addition, many prefer local in-person services so that their payments support their local economy. If you are a coach or consultant yourself, there may be self-interest supporting a marketplace between business to business suppliers.

Local businesses engage in their local economy.  They can help you build contacts and find customers.  Another advantage is there may be opportunities for collaboration.  Many offer follow-up services to clients too.

There are advantages sometimes to using online services.  If the support you need is not available locally, you must go elsewhere.  You will bring new skills, learned online, to your locality.

Another advantage is online programmes do not need you to be somewhere at a specific time.  If the course is video or audio based, you take part at times that suit you.  You can use downloads in your car or whilst walking or jogging.

Using Support Services

Training

There are many training opportunities, some free and so it is worthwhile exploring what is available locally.

Usually, training courses run to an agenda set by the trainer.  They will have done their research and designed a programme that meets demand as they understand it. There may be opportunities to request items on the agenda.  These experiences may be opportunities to try something new.  Maybe you can engage a coach if the topic proves relevant to your business.

Some courses are accredited and this can be an advantage.  A certificate can be used to enhance your credibility.  It is possible to badge your website with some training providers as evidence you have a particular skill.

Coaching

The first point to make is coaching is not for novices.  Think of coaching as an opportunity to explore issues in-depth and confidentially with someone knowledgeable about your work but not directly involved with it.

Yes, of course, you may need a coach to work on some difficult period in the life of your business but successful businesses often engage coaches over the long haul.

There are two types of support: expert and non-directive.  An expert consultant usually offers a Done-for-You service.  They save you time and money because they know how to do something and will do it for you.  The assumption is you do not need to learn the skill they use.

Non-directive consultancy, often called coaching, is a Done-With-You service.  They may introduce new ideas and concepts but the focus is on equipping you to do something.  The key thing is you are in the driving seat.  The coach will help you decide a course of action, implement and evaluate it.  This is one reason some coaching schemes are better over a longer period, so you can see through a course of action together.

Marketing

Marketing services are usually expert consultancy and perhaps the big issue here is what you get for your money.  Are you seeking a DFY or a DWY service?  Is your priority to save time and get a job done or to learn it yourself?

You could engage a website designer, for example, if you have no interest in learning how to design and build a website.  You want someone who will design, build and test it for you.  Perhaps this is a less likely approach today when there are so many out-of-the-box website themes but it does depend on what you want.  A good theme may not always meet the needs of your organisation.

If you are planning to engage a marketing service you need to be a good consultor.  If you do not know what you want, you cannot brief the consultant.  the consultant will need certain information to do a good job.

Do your homework so you know if the consultant has met their brief.  If something doesn’t work, there are at least two explanations.  The expert is not necessarily as expert as they first appeared.  This is a tempting explanation but not the most likely one.  More likely, you did not provide an adequate brief or undermined the expert by constantly chopping and changing.  It’s your business, your money and so your responsibility.

Your business costs provide opportunities for other businesses and you can support a range of people by making good choices for your business support services.

Has this post been helpful?  Please tell me if it has and ask any questions you may have.  I can’t cover everything in a single post, so it is helpful to receive questions about issues I may have missed.

0 How Many Conversions Do You Need?

Hopefully, you know what conversion is!  The word describes when someone responds to something on your website in the way you want them to, eg by making a purchase or signing up for something.  But it can just as easily apply to a decision made at an in-person meeting.  The question: How many conversions do you need? implies the number of sales you need to break even.

This question in the circuit questionnaire is about your business viability.  If you cannot meet this target, it means sooner or later your business will fail.  This is not about your aspirations but the practicalities of making your business work.

For the values-centred business, your business follows the same rules as everyone else’s.  Once you know you can meet your target, you have capacity to invest your income in your causes.

How to Make the Calculation

Conceptually, the calculation is not too difficult.  You divide the price you charge for your offer into the amount you need to live and pay for your business (your annual turnover).  However, these can be more complicated than they first appear.

Your Turnover

Your turnover or outgoings are the sum of your business overheads and costs plus your drawings.  The linked post explains them but here is a quick summary:

Don’t get hung up on detail here.  The main thing is to find an approximate figure.  You can refine it later as you get figures from your business practice.  Your outgoings will change as your business develops.  You may find that when you hit your target, your costs increase because your business activity has increased!  So, be generous in your calculation and careful about your actual expenditure!

Your Charges

If you have a single offer, this is simply how much you charge for it.  But take care.  Many business owners charge less than their advertised fees for various reasons.  For example, I charge on paper £1500 for one of my offers.  For various stated reasons though, I usually cut this by £200.  So, the fee is actually nearer £1300.

If you have a single offer, you simply divide its price into your total outgoings and this tells you how many sales you need over a year.

However, few business owners have a single offer.  I generally recommend having between 2 and 4 offers.  With two offers, you can offer a choice and this reduces prospects saying no.  More than 4 offers are likely to be confusing for you and your prospects.

There are a few options here.  You could use your highest priced offer and this will show you how many of these sales you need to make.  Some people argue you should aim to sell your highest offer because it is hard work finding clients and so you need to get the best returns you can when you find one.  The alternative view is you want to sell the best package for the client and they might not need your high-end package.

If you have many packages or sell a range of products or have a specialist market with individually tailored offers, perhaps the easiest approach is to calculate your average monthly income, divide it into your turnover and multiply the result by the average number of customers.  No approach is accurate but you don’t need absolute precision.

If you know on average how much a customer spends, it is the figure you need.

What To Do Next

When you complete the calculation you have the number of customers or purchases you need per year.  Divide by 12 to get the monthly number.  This is a useful figure because it gives you an idea of the challenge you face to find enough customers to break even.

There are broadly two ways you can respond to these figures.  If the number of customers are higher than you are already experiencing, you must either find more customers or increase your prices.

Price increases become easier as you become established.  If you have a positive reputation and find people are recommending you, this is the time for a price increase.  There are various strategies but it is far and away the most effective strategy towards business viability, so long as your marketing is effective.

It may be possible to increase customer numbers, as you become more experienced, review packages, adapt them to your customer’s needs and improve your marketing.

Perhaps the most important outcome is it shows you whether have a viable business.  Do not despair if the outcome shows you are not viable.  A minor change in direction may be all you need.  This may be where you need a coach to help you think through your next step.

Has this post been helpful?  Let me know what else you need to know about this topic.

0 Are Community Development Workers Consultants?

This blog connects a unique range of topics from website design to marketing to consultancy to community development. This feedback appeared in my inbox this week, asking: are community development workers consultants?

0 Earning, Saving and Giving

Last time I introduced the theme of making profit in a values-centred business. I touched upon drawings during my recent sequence about self-employment.  I didn’t say much about them and certainly nothing about the values that apply to this part of our economic activity. Values apply to three aspects of domestic finance: earning, saving and giving.

John Wesley, in his sermon 50 “The Use of Money”, wrote “earn all you can, save all you can, give all you can”.  Now I appreciate most readers do not feel bound by the teachings of an eighteenth century evangelical preacher.  But Wesley’s three points are still a useful ethic for the values-centred business person.

This is the second post in a sequence about use of money and so I shall not cover everything about use of money here.  Comment on anything you think I’ve missed but I may have held it in reserve for a later post.

Your Earnings and Your Value

“Earn all you can” implies no pressure to go beyond your capacity.  It is possible to live a dignified life on a low income.  It is not only possible to be happy on a low income, it is a great blessing if you can.

If you enjoy life, possibly you are earning enough.  Satisfaction means you have a degree of independence from the formal economy.  There are lots of reasons to be dissatisfied; the system can make life difficult for people on low incomes.  The same was true in Wesley’s day and one reason he advised his followers to “earn all you can” was the consequences of poverty he had seen in his travels around the country.

Those who earn more are able to share with those who don’t.  This was the expectation in Wesley’s religious societies.  Each member had to pay their dues but Wesley expected wealthier members to help poorer members.

Legitimate Earning

There is an implied expectation that earnings are legitimate.  This rules out income from crime and possibly other activities.  This is where values come in because it is difficult to legislate for what is legitimate income.  For example, for many years Methodists opposed alcohol and so presumably members working in the alcohol industry would be pressured to get out of it.  This would not be true today, where Methodists see alcohol in a more temperate light.

Should we, for example, be concerned about working in the banking industry, after the crash of 2008, precipitated by the dubious financial activities of some bankers?  These issues recur again and again.  Go back a couple of decades and there were similar pressures on bank employees where the banks invested in apartheid.

Wesley would be the first to claim your worth as a person has nothing to do with what you earn.  Your personal values might impact on what you choose as a career.  This is a matter for conscience and it is perhaps best to leave it there.

The Protestant Work Ethic influenced Wesley and he did not seem critical of the Industrial Revolution per se.  When we contemplate the inequalities that divide the world into wealthy and poor nations, the environmental consequences of the industrial world, we must approach earning from a different perspective.

What Does it Mean to Save All You Can?

There are three ways to approach this.

Control Your Spending

First, Wesley does not mean by “save all you can”, put your money in the bank.  He was not thinking of the banking system or even keeping reserves of money in a box under the mattress.

What he meant was to be constrained in what you spend.  Buy what you need and ideally no more.  Be content with the basics you need to live a full and dignified life.  The money you save is to be given away.

There is much to commend this approach today.  We tend to over-consume and this has a devastating impact on the world we depend upon.  Our children and grandchildren will find their lives impoverished because of the resources my generation has consumed. I’ve already touched on these issues under “earn all you can”.

Be Discerning About What You Buy

The second approach to wasteful and negligent business is to boycott it as a consumer.  Few can refuse to work for businesses that are immoral but most can choose to refuse to buy from them.

This is only part of what Wesley meant.  Do you really need that bottle of wine?  You could save the money and give it away.  Do you need that DVD?  And so on.  Ultimately, these are decisions we make as individuals.

But if you refer back to my last post about profit as the purpose of business, you will see much of the rhetoric around business is the promise of the good life, should you make the breakthrough.  And that argument is solely about personal comfort.  Many of the Internet gurus boast of their beautiful houses and their yacht.

This is the profit-centred ideology where profit grows personal power.  It is interesting some wealthy people still work out how to give all they can.

Support the Local Economy

There is a third way to save all you can, a way to save and give in the same act.  It is to favour local business over corporations.  If we want money to circulate in the economy it depends on our spending practices.

Hospitality

I shall return to giving later in this sequence and consider charity among other forms.  But I want to focus on one dimension of giving, hospitality.

I have major issues with generosity.  After decades of struggling with my own tight-fistedness, I know what a blessing generosity can be.  I live on my own and mostly care for myself.  I don’t have any problem with that.  Many people don’t care for themselves and self-care is something we all need to do.

I am grateful for friends generosity.  Being in business, I am much more aware generosity is essential for the conduct of my business as a coach.  I try to over-deliver on my promises and I’ve begun to understand when you can rely on income, hospitality becomes easier.

Business naturally leads to generosity or to accumulation of finance, where there is lust for power.

So, the first step before giving to charity and everything else the benefactor might do, is the basics of generosity and hospitality to those people around us.

What is your experience of earning, saving and giving?

0 What is Your Market Size?

Here is a paradox for the freelance.  Consider the question: what is the size of your market? You might think the larger the size, the better it is for you.  This is rarely true.

Mass and Niche Markets

Most of the advertising we see aims at a mass market.  Consider its content.  It promotes products that meet our basic needs.  So, you see adverts for food, clothes, cars and so on.  You don’t see mass market adverts for coaches or consultants.

Mass marketing focuses upon whatever is new.  The latest films or TV programmes have a mass market appeal.  Even a coach with a brilliant new approach, does not use mass marketing.

Cost is an important factor.  Granted, advertising online is available to niche businesses; it is not on the scale of hoardings, TV adverts, newspapers and magazines.  Such large-scale advertising is still out of reach for small business owners.

This is not really a problem because there is a more profound reason small businesses don’t use broadcast advertising.

They have a niche market.  To address the whole population is redundant.  If your niche is in a particular locality, there is no point telling the world you are there.  The people in your niche need to know you are there and no-one else.

So, the challenge for most freelancers is to find the narrow group of people in their target market.  There are marketing approaches that work for these groups and not for the mass market.

How to Find Your Niche

You need to find your niche and almost certainly find this rather difficult.  Why?  It is hard to see how narrowing your market can increase your business.  It’s counter-intuitive to think you increase business by turning some people off.

But marketing is costly in time and money.  To waste time communicating with people who are not interested in your offer is not going to get you far.  If people approach you because you are known for your offer to them, this is far more efficient.  All you need is to work out how to turn their interest into commitment to working with you.

Let’s focus on narrowing your niche.  The big mistake people make is to think their niche is one-dimensional.  There is a lot you can do to design your packages to appeal to a narrow group of people.

Other Ways to Narrow Your Niche

Just as you make choices when designing your packages, you can also make choices about other things.

Specialisation and Prejudice

When you narrow your market, you are stating a preference not building a wall to keep out undesirables.  The decisions you make help you target your market.  It is not a failure if you draw some customers who don’t quite fit your market definition.

Indeed, these customers may be immensely valuable because they may point to a better definition of your market.  Prejudice would make you unable to see this new opportunity.

To specialise is to choose your preference because you believe it is for people most likely to take a serious interest in your offer.

Let’s say you want to specialise in delivering a service for women that could be equally valuable for men.  You have your reasons for this choice, let’s assume they are valid and don’t amount to discrimination.

First, note most men know some women, they may know women in your market.  You cannot afford to put men off because you need them to carry your message to your market.

Do all your packages need to be women only?  If you are a coach, you could deliver workshops to both men and women.  This would help all involved understand your offer and in partnership with someone who makes a similar offer to men, it could be a powerful marketing opportunity for many businesses.

If you are an expert in the particular issues women face in business, it makes sense to seek the market who can benefit.  Maybe outrage at the discrimination women face in working life is legitimate.  The challenge for the niche marketer is saying this with good grace.

Conclusion

To define your niche is a massive step forward because you can address them directly.  But do not make the mistake of thinking your niche is set in stone.  Be alert for those who approach you out of the blue.

They have heard your message and it appeals to them in some way.  Find out why.

Have you ever been surprised by who has responded to your marketing?

0 Your Business Purpose: Supplier or Consumer?

Last Wednesday, I discussed the idea: profit is not the purpose of business.  The post was the first in a sequence about profit.  Today, I’ll explore another idea about the purpose of business.  A business is a supplier of goods, services and perhaps other things too!

Let’s start with maths. It makes sense for businesses to be suppliers. After all, if the business is a net consumer then it is making a loss. However, business is not so simple. Any product or service has costs attached.  It is not unknown to supply something and then discover its costs are greater than the charge attached.

Supplier of Information

The contribution successful businesses make to the economy is their knowledge about how to deliver things at minimal cost. This value triangle, helps us see how it is possible to choose any two out of three positive criteria. You can have a high quality service fast but you will have to pay for it. In this instance, the business passes its costs to the customer. The customer able to wait for the business to find low-cost suppliers, will find the overall cost to be lower.

This holds true for pretty much all businesses. What they do is identify a problem and find a low-cost solution.

The Entrepreneur

The entrepreneur keeps their eyes and ears open. They seek opportunities of potential benefit to their market and deliver them at low cost. They know, for example, how to persuade other businesses to offer their services at low or no cost.

The entrepreneur knows how to bring people together to work on innovative solutions to problems. They educate their contacts by providing opportunities to practice new approaches that solve problems, open up new markets, encourage collaboration and build the local economy.  Ideally everyone involved benefits, this mutual benefit is the badge of honour worn by all true entrepreneurs.

Usually, a good story results from the work of entrepreneurs. Do you have any to share?

0 Profit is Not the Purpose of Business

It’s time to talk about money.  Perhaps this is a taboo subject.  But we all need to come clean.  It is easy to reject profit and at the same time be mistress of the arcane art of grant applications.  Community activity, just like business, depends on money.

This quotation is from a contemporary economist from Scotland, called John Kay:

Profit is no more the purpose of business, than breathing is the purpose of life.

Profit, or money in general, is not the purpose of business but its means.  We think about money in the wrong way.  It is essentially dynamic and has purpose when in use.

As soon as we think of money as something to accumulate, we lose sight of its purpose.  The purpose of business is to do stuff.  This is true whether you are a business, a community organisation, a church, a local authority …

Two massive mistakes seem to pull in opposite directions.  Both believe business exists to generate profit.  Profit is essential for business survival, just as breathing is essential for human life.  We don’t live to breathe, do we?  So, why do we think business exists for profit?

Because the profit motive is the root of modern economic thinking. There are broadly two mistaken approaches: one embraces profit as the purpose of business, the other rejects it.

Profit as the Purpose of Business

A profit-centred approach leads to inequality.  Let’s clear away a few myths.  First, there is nothing wrong with some people owning more than others, so long as everyone is able to live with dignity.

A strictly equal society would be equal at sword point.  Only violence could enforce strict equality and those holding the sword would of course never succumb to temptation and accumulate more for themselves!

The problem is we are measuring the wrong thing when we measure personal wealth.  We need to measure wealth to understand inequality but the most important measure is money in circulation.

Societies can be less unequal than they are today.  They were, for example in the mid-twentieth century, when two world wars eroded inequality.

Profit-Centred Business Ideology

What does it mean when profit becomes the purpose of business?  It legitimises selfishness and dishonesty.  For the profit-centred business person the aim is to use any means to accumulate capital.

Regulation becomes offensive because in a completely unregulated market, personal power counts.  Lust for power erodes human relationships and apportions blame to weaker people.  Typically, subjugation of women and others on grounds of ethnicity happens because the powerful need groups they can blame when things go wrong.

This approach fixes on a mythical past when things were better.  It is a nostalgic worldview, based on pure fantasy.  But nostalgia plays well with many people and so populist movements can grow around charismatic business owners.

In 2016, we saw the triumph of Arron Banks in the UK and Donald Trump in the US.  Both are billionaires with the common touch.  Both focus solely on the profit motive.  They exercise a reactionary power that targets democracy because they believe democracy gets in the way of business.

They exist because the ideology of profit-first lends them legitimacy.  Their belief that business equates to profit leads to massive corporations extracting finance from the economy and so increasing inequality.  On a smaller scale, business becomes cutthroat, reducing collaboration and denying society the contribution businesses can make when they recognise a role beyond their immediate profit.

Rejection of Business Because of Profit

No-one can afford to make this mistake any more.  By rejecting business as a legitimate approach, we allow the political right to decide the purpose of business.  The pendulum has swung so far in that direction that it is almost impossible to get alternatives heard.

The reactionary right has succeeded because they have created a delusional alternative to the prevailing economic system that will in all respects be worse because it is committed to deregulation and is anti-democratic.

Radical movements do not have to reject business and indeed the idea they must is a late twentieth century mistake.  The problem radicals have is the mirror to the reactionaries, who focus on an imaginary past, while radicals live in an imaginary future.

Equality, democracy and all the freedoms we value depend upon people collaborating to resist those who would control our lives in the name of profit.  This is true here and now.

By rejecting business, radicals have allowed the right to control the market. Now the reactionary right are seeking political control, where they can deregulate our markets, increase inequality and destroy democracy.  They deploy their prejudices to mask their real values.  Deregulation benefits the corporations and disadvantages local businesses.  Those who would oppose them deny themselves the means to do so when they reject business as a legitimate activity.

So, this sequence will help you understand money, not in terms of nostalgia for a mythical past or dreams of an imagined future.  We need business rooted in present realities, building localised markets and mutual values.

0 How to Make Safe Predictions about Market Preferences

Making predictions is never an exact science.  As you learn more about your market, you increase your understanding of market preferences.

Ask anyone from your market about a particular preference and you could get any answer from completely positive to completely negative.  In that sense, you cannot predict a person’s personal preferences.

However, there are advantages to knowing where on the spectrum of opinion most people in your market fall.  When you are marketing, you are setting out your stall.  You attract some people who are not in your market and possibly repel some who are.  The better you are at setting out your stall, the more likely you are to attract the right people.

Once you talk to a prospect, you can fine-tune your appeal and respond to their individual preferences.  This depends upon your sales technique.  You need to practice it and the only way to do that is to find prospects.

So, the aim of making safe predictions is to find preferences that attract the right people, reducing as far as you can false positives and negatives.

As you grow in understanding your market, you get better at this.  The first step is to know what to look for and the issues raised in this question are a starting place.  You will find some of what follows more or less relevant to your market.  The real challenge is finding issues not listed here that energise your market.  How?  Be present, spend time with your market with eyes and ears open.

Risk and Security

This is a big issue for financial advisors who have to ask about a saver’s attitude to risk.  I wonder how many people lose out because they don’t understand the question?  How many people ask to see high-risk opportunities?  How many who don’t, miss opportunities they would not otherwise encounter?  You see my point here?  This is not about finance necessarily.

The issue is the person who steps back from something they perceive as high risk might respond positively if they knew more.  So, your marketing challenge is to raise possibilities your market may not have considered, if it is risk averse.

Organisations are often risk averse.  Health and safety legislation, for example, aims to keep the organisation safe.  There is a lot to commend this approach until it becomes a reason not to act.  I’m not saying strategies should risk safety but safety costs need to be included in planning.  “It’s worth making these costly improvements because it will mean we can do so much more.”

Quality and Value

Let’s think of this in four quadrants:

Novelty or Proven

Some people like to be ahead of the crowd, pace setters who are always the first try new technologies or approaches.  Others will invest in something that has a proven track record.

This is why new businesses can find it difficult to get established.  The people who are willing to try something new are thin on the ground.  Breaking through to the bigger established market is hard work.

The technology adoption curve shows how this works in practice.  You will see, if you follow the link, moving from early adopters to early maturity is difficult.  This is the challenge if you are introducing something new to the market.

On the other hand, the challenge is different if you are marketing some established approach, such as life, personal or business coaching.  Here the issue is how to distinguish your business from others, without giving the impression it is something entirely new.

Individual or Mass-Market

Coaches and consultants offer an individual service. Most adopt an approach to coaching they choose so that the package they offer is a proven method.  But essentially the service is individual and this is why they are able to charge high fees.

They can offer workshops to groups of people for a lower fee.  They may offer the same content but with less personal service.

This distinction holds in any market.  Supermarkets get by with little individual service.  Most people know what they need and can find it without help.  Contrast that with a behind the counter service, where everything is individually found, measured and wrapped.

Mass-production cuts costs and increases choice.  Most coaches offer limited options at a high price.  If their offer is not right for a prospect, they will refer them on.  There are loads of books about coaching for those who do not favour the individual market.

Design or Functionality

This is of course a false dichotomy.  If something lacks functionality it lacks design.  You would think few people would buy something pretty that doesn’t work!

For example, website design.  Many people still think of websites as works of art.  They do not understand the functionality a website can offer them.  A site that looks good and does not convert is an ornament.

Some sites look dreadful but they convert.  Maybe they were slung together without any thought to design and for some reason worked.

On the other hand, think of something like Apple products where design and functionality work together.  If you can do that it’s a big advantage.  If not, make sure it does what it needs to do.

What other preferences do you find your market has?