What do you need to succeed in a service-oriented business? Here are a few
ingredients that you need to successfully start and run a service business.
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1. People Skills.
The success of your service business depends on your
ability to work with various clients. You will have all kinds -- some
demanding, mercurial, passive, and some who do not seem to know what they
want. Others change their minds so often that it is hard to keep pace with
every change of their whim and wants. Nonetheless, your clients are your
bosses, and your business hinges on how satisfied your clients are with the
quality of your service.
To successfully deal with clients, you must have loads of patience, the
ability to read people and ask them the right questions to draw up what it
is that they really want. During your first meeting with potential clients,
listen carefully as to what they want. If you are a wedding coordinator,
what are the client’s preferences? What is the bride’s vision for her
wedding? The initial meeting or consultation is your moment to size up the
clients, gain their trust and establish a rapport.
However, you must also use your intuition in choosing your clients.
During your start-up phase, you may be thinking that it is bad business for
you to turn away some clients. The truth is you need not accept every client
that comes your way, particularly if the client has a totally different way
of looking at things from you. You and the client must, at the very least,
share the same fundamental principles. If you are a fashion designer who
favors minimalist design, it may be hard to please a client who wants
avant-garde, over-the-top clothes. You may end up trying to be what you are
not. Or you may just be wasting your energy trying to convince the client to
your way of thinking. It is not productive to work with clients who are not a good fit for your business.
2. Contract.
A well-written contract is a must-have tool for every
service business. Whether you are a wedding photographer, a web site
designer, a consultant or an accountant, it is best to put that handshake
into a written agreement. An unambiguous contract can help protect your
business, clarify expectations with your client, and clearly define the
deliverables. It must also reflect the special rules in your location
governing your kind of business.
To save costs, you can draw up the contract yourself and simply go to a
lawyer who can review and revise your draft for a small fee. You may be able
to find an attorney willing to help you keep your start-up costs low through
referrals from friends, fellow entrepreneurs, colleges and universities, and
organizations such as your local Small Business Development Center (SBDC).
When approaching a lawyer, be sure to clearly specify what you want done and
clarify the costs involved. You don’t want to be charged for services that
you do not really need.
3. Smart Pricing.
Determining the price of your service is one of the
trickiest questions in starting a business. The price of your service must
be based on the perceived value of your service (or what you can offer to
your clients), as well as the prevailing market and competitive conditions.
You may be tempted to offer prices so low in an attempt to attract
clients away from competitors. Be careful, though: there is a difference
between a bargain and being cheap. Competing solely on price alone, or being
cheap, can backfire on you since customers oftentimes equate the value that
they can get from a merchant with the price. In a customer’s mind, a
merchant’s service is “expensive” because the merchant may be offering
something uniquely special. Plus, they can get bragging rights for using a
merchant with a reputation for being expensive.
On the other hand, you can introduce low prices by positioning your
service as “value for their money.” Customers will think that you can
deliver something that requires very reasonable investment. With this
approach, your service can be perceived a bargain, but not cheap.
If you plan to lower your price or offer a discount to a client, do so
only to get something in return. Don’t give discounts away like every
customer deserves one. The lower price may be in exchange for referrals to
other clients, longer-term contract, bigger package, or other concessions.
4. Continuous Marketing of Business.
Like any other business,
you need to dedicate at least a couple of hours everyday to get your name out there. You can use a variety of techniques: networking
and participating in organizations, publicity and public relations,
advertising, and making use of other mediums such as a Web site.
Word of caution, though, in using the Web to sell your services: a web
site is not always effective to sell a service business. For the Web to
become an effective medium, your business should be easily understandable to
the audience. It should be a standard or common business where people
already know what to expect when they buy your services. Customers should
know what the business is, understand what to expect from such a service,
and know when and how they need that kind of service.
An example would be a public relations company that charges a fee for
writing and distributing press releases. The deliverables are clear, a
sample can be provided on the web site, and a standard price can be set,
even with a few customizations.
The Web may be a less effective medium if your business is so new and
esoteric that customers may not understand what it is that you are really
selling. If this is the case, you would need to work harder in educating
your customers and making them understand how your service can benefit their
lives or businesses. The site can simply be a brochure where people can get
your contact information should they be interested in your services.
Save for a means to tell people that you exist, businesses like
consulting may not work well for the Web. A consulting business, for
example, requires extensive inputs from the client. You first need to sit
down with the client to determine their needs before you can present your
price and deliverables.
5. Follow-Up.
Your success depends on how your clients perceive your
service. You may think that you’ve done such a great job, but your client
may have a thing or two about how you delivered your service. To help
further improve your service, and correct the mistakes you’ve made, it is
important that you get the feedback of your client. It also reinforces the
client’s belief that he or she is important to you.
After the end of a contract, check back with your client and ask for his
or her opinions about your service. It may be in the form of a survey, or a
brief chat. If they are satisfied, you can even ask for testimonials and
referrals to their friends, family and relatives.
About the Author:
Jenny Fulbright is a
staff writer of Power Homebiz Guides.
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