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Do I Really Need More Customers to Make More Money?
“I need more customers.”
This is the default for nearly every business owner I've ever met when they are looking for their business to make more money. If you want to increase your income next year, you need to increase your sales. And if you need to increase your sales, you need more customers.
But do you?
For a solopreneur or very small business owner, getting more customers doesn't just mean more money coming into the business. Nine times out of ten it means more work. More appointments, more projects, more emails, more estimates, more follow-up, and more hours spent actually providing whatever it is that you sell.
At some point, there are only so many customers you can add before you hit your capacity. That's when a business owner who simply wanted to make more money can find themselves facing a completely different set of decisions. Do you work more hours? Hire someone? Outsource some of the work? Invest in additional equipment or a bigger space?
The business has grown, but has the amount of money you're actually making from it grown enough to make all of that worthwhile? That's why I think it's worth questioning the assumption that making more money always starts with finding more customers.
What If the Opportunity Is Already in Your Business?
Let's say you want to make an additional $20,000 next year. The first question I'd ask is whether you want your business to bring in another $20,000 in overall revenue or whether you want to have an extra $20,000 left after paying your business expenses.
Because those are two very different goals.
If you're looking for another $20,000 in overall revenue, you might immediately start calculating how many additional customers it would take to reach that number. But before you do, consider whether there's an opportunity to generate some of that revenue from the customers and services you already have.
A photographer might decide they need to book more sessions. But what if they're already booking about as many sessions as they comfortably want to photograph? The opportunity might not be another 20 sessions. It could be changing what existing customers purchase or how their packages are structured.
A therapist might have the same problem. There are only so many appointments they can reasonably fit into a week. Filling every remaining opening might increase revenue, but is a completely full schedule the business they actually want?
A tradesperson could be in the opposite situation. They're already busy, the phone is ringing, and there's more work available than they have time to take on. More customers certainly aren't the problem. The question might be whether they're making enough from the jobs they're already doing.
None of those businesses necessarily needs to get bigger. They may simply need to look at how they're making money from the work they're already doing.
Growth Doesn't Have to Mean More
We tend to talk about business growth as though it always means adding something. More customers, more revenue, more employees, more services, or more locations. But growth can also come from making better use of what you've already built.
It might mean realizing that a service you've offered for years takes too much time for what you charge for it. Or increasing a price that hasn't changed even though the cost of providing that service has gone up. It could mean offering something additional to customers who already know and trust your business rather than constantly looking for someone new.
It might even mean doing less of one type of work so you have room for work that contributes more to the business. Instead of asking, “How do I get more customers?” you're asking, “Where is the opportunity in the business I already have?” And the answer is going to be different for every business.
More Customers Might Still Be the Answer
Sometimes you really do need more customers. If you have room in your schedule, your pricing works, you're happy with the services you're offering, and each additional customer contributes enough to make the additional work worthwhile, bringing in more customers may be exactly where your growth opportunity is.
There's nothing wrong with that answer. What matters is that you've considered whether adding more customers makes sense for your business rather than automatically assuming that's what you need to do.
Because there is a big difference between wanting to make more money and wanting to run a bigger business. For some business owners, those two things go together. For others, they don't.
Let Your Numbers Challenge the Assumption
This is where your numbers can help you make the right decision for your business. Your numbers aren't just there to tell you how much you made last month or whether your expenses increased. They give you information about the business you've already built.
They can show you that you're bringing in more revenue but keeping less of it, or that your expenses are increasing faster than your income. And when combined with what you know about your workload and available time, you can start to see whether adding more customers would actually help you reach your goal.
Start by looking at how much revenue your business has brought in this year compared to last year. Then look at your expenses. Have they increased at about the same rate, or is one growing faster than the other? Your Profit and Loss report is a good place to start because it shows you what your business has earned, what it has spent, and what's left over.
But don't stop there. Think about which services or types of work are bringing in that revenue and how much time you're spending providing them.
Maybe your most popular service is also the one that takes up the most time. Maybe you've increased your sales, but the costs associated with delivering those services have increased even faster. Or maybe it has been a while since you considered whether your existing pricing still makes sense.
Your financial reports may not answer all of those questions on their own, especially if you aren't tracking income and expenses by service or job. But they can give you a starting point for knowing what questions to ask.
Your numbers aren't going to tell you what kind of business you should build. That's a decision only you can make, but they can give you the information you need to make it with more confidence.
Before You Start Looking for More Customers
Before you start looking for more customers, spend some time looking at the business you already have. What's bringing in the most revenue? What work takes up the most time? And how much of the money you're bringing in is actually staying in the business?
You may discover that you have room for more customers and that adding them would help you reach your income goals. Or you may find that changing what you charge, what you offer, or which work you take on would make a bigger difference.
Either way, you'll be making that decision based on what your business actually needs, rather than assuming that more customers automatically means more money.
About FABS
I'm Sheri-Lynn Fournier, owner of Fournier Accounting & Bookkeeping Services. For more than 20 years, I've helped solopreneurs and small business owners keep their bookkeeping up to date and understand what their numbers are telling them. Through my Trust Your Numbers approach, I help business owners feel more confident about the financial side of running their businesses.
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