Building a successful consulting business where you create consistent income does not happen by luck. It’s by design. Consistency – in client acquisition, workload & income – is by far the biggest struggle in our industry. This article outlines a business building strategy where you get to even out the feast and famine rollercoaster ride towards a more reliable and worry-free client flow experience.
As a consultant or coach, I’m sure you know the anxiety and stress of not quite knowing when your next piece of client work is coming in. I’ve heard hundreds of freelancers and solo professionals tell me this over the years. The issue is that they can never predict monthly revenue enough to plan their finances or take a holiday. I wanted to do something to help rectify the problem. What’s needed is all to do with strategic planning – and that’s my expert thing – both in my client work and my own business.
Ditch the Revenue Rollercoaster
The financial rollercoaster ride can take its toll on your mental and physical health as well as substantially lower the fun and freedom benefits of being your own boss and running your own show. When you don’t pull in regular work or if clients cancel or postpone, your cash flow goes haywire. Things feel tight one month and flush the next. At the same time, most of your “outgoings” will go out invariably every month.
Originally, when I set up my consulting business back in 2007, I’d created a particular blend of work to minimise risk and avoid being overbooked at any given time. I called it my Regular+Intense strategy and it was a mix of:
- Regular “𝘭𝘰𝘯𝘨 𝘢𝘯𝘥 𝘵𝘩𝘪𝘯” contracts (i.e. a few days a month spread across the year or something I did over a few weeks every year); and
- Irregular, tendered work that I called my “𝘴𝘩𝘰𝘳𝘵 𝘢𝘯𝘥 𝘧𝘢𝘵” projects (i.e. a big 5-10k piece of intensive work over 2-4 months).
All in all, this strategy worked great for getting things up and running. In those days, I rarely turned down work I was asked to do, so the downside was I ended up with a mad schedule of intense project work and a lot of “bits and bobs”. I felt like I was also on a rollercoaster in terms of the workload and focused brain work.
But also, of course, the cash-flow was inconsistent. If one or two invoices fell just outside the end of March, it looked like a big drop in income one year and a bumper year the next. At least in one or two tax years, this mix produced a crazy dip in revenue. Yet bank managers, mortgage lenders, accountants etc do not seem to appreciate this isn’t unusual for self-employed consultants. Even though on average, you can be earning six figures, they see us as at risk because there’s no regular income month-by-month. On the books, ups and downs look dubious.
On top of that, my income in those early years was based on daily rates, which meant a frustrating ceiling on what I could earn in any given month. And I was tired as heck. In the intense periods, I’d be working my high-end client projects 6 days a week, rarely took a holiday. And on the dry periods, rather than take a break to rest and unwind, I’d be working hard to get new work in and feeling anxious in case I didn’t. (I have to say after 12 years, I stopped worrying quite so much and now know how to handle the ebb and flow over time, but at the time it all felt a bit wobbly, like it could all collapse at any stage.)
The situation was *freaking* me out as I felt my business was running my life, rather than planning my life around my business – and I was never quite sure what money was coming in when. Plus, I had two school-age kids at home who deserved my attention and needed a relaxed not stressed mama.
So I decided the Regular+Intense strategy wasn’t workable or sustainable.
Design a Predictable Profit Process
Fortunately, there are ways to build predictable income over time. It’s taken me a while, but here are some of the strategies I implemented to create consistent income in my consulting business.
With a shift in business design and marketing, you can stop the feast and famine cycles or at least even them out a lot more.
Consulting as an industry is renowned for its economic ups and downs – that’s just the norm, so best not take it personally. The lack of consistent income doesn’t need to make you anxious. There are ways to smooth out the peaks and troughs of what is a typically cyclical business.
Two key levers to help create consistent income are: (1) creating a marketing plan to drive your client work; and (2) optimising your project management capability to support your client work.
I shifted gears towards only taking on certain kinds of clients and certain kinds of work. I call this my Leverage+High-End strategy. You will have to put some effort into creating this one time but then you’ll usually only need to refine it periodically.
Firstly, I redefined my brand around 1-2 areas of expertise, created a system for each and packaged it into a programme I use with every client.
And secondly, no more pay-by-the-day arrangements; all my client work is on a contract agreement, invoiced monthly or on a payment plan not on completion.
Create a Leveraged System
Here’s why it helped me create consistent income without the workload stress and anxiety issues that consultants typically suffer.
1 – My branding is designed according to my clients’ desires & needs.
I focus on being the ‘go-to’ expert in a specific target market and position myself with where those people hang out.
This is because I know who my ideal clients are and I can communicate a clear, tangible end-benefit.
I’m actually able to find more clients and charge more for the work I do by “niching” down into a specialism.
2 – My marketing is designed according to my income goals.
I focus all of my marketing on driving my ideal audience to one “signature” offer. I’m not dependent on a small number of clients for repeat bespoke work.
This means I’m not spreading myself too thin, my marketing process is automated and all my content is helping those people see I’m someone who understands the problem and who can help them.
My exploratory sessions are scheduled by appointment only with pre-qualified prospects and I know how many I need to book in to enrol enough clients every month to hit my revenue target.
3 – My delivery is designed according to my life goals.
My client work follows a structured and systematic process over a defined period of time (agreed in the contract). I’m not reinventing or tailoring the process every time I work with a business or organisation.
It’s still super flexible in terms of the scope and needs, but now there is structure and consistency in how I plan the work with each client. Each project is managed in the same way.
My service delivery schedule accounts for the gaps I want or need for rest, creative work, holidays, family time etc.