Double your sign business income
This question was recently posted on a sign forum website. I thought was a very valid and common thought that most of us have from time to time. The original comment and question has been edited a bit but essentially it was… “I have been working SOLO for 10 years with yearly sales of 150k and a profit about 45k. If I hire 2 employees and double my sales, at the end of the year I will probably make as much as now. My question is how can I double my income?…”
The answer to this very honest question was as follows…
My suggestion would be to step back and evaluate exactly what you want to accomplish here.
IF you simply want to double your personal income then there are other ways than to simply add employees.
If you have never heard of the 80/20 rule then basically it states that 80% of the money generally comes from 20% of the people. In Sign Shop terms… 80% of your profits are probably coming from 20% of your clients. Inversely, 80% of your current clients are probably just as draining on your time, resources and energy as the other 20% BUT without contributing much to your profits. Chances are, you can already picture in your mind who these clients are.
To take advantage of the 80/20 rule try these steps…
- Identify where most of your profits are coming from by specific products, customer segment, geographic location etc.
- Identify additional & duplicate customers to add to these profitable ones. For example… If you make most of your money selling banners to schools then focus time and effort on adding some more schools to your customer base.
- Begin to cut out the 80% of your customers who do not meet your profitability standards by sending their work to other shops or simply firing them… Yes, you can fire customers.
As you work through this process (and it does take time) you will begin to see your workloads decrease and your profits increase. You will find that this is an excellent way to improve your personal income while simultaneously regaining control of your workflow