Pivoting your business as a small business owner is both easy… and a challenge. Here’s a business strategy to take the pain out of adding and removing services.
In the corporate world, it’s ridiculously hard to pivot your career without taking a major hit to your bank account. In those 5 ½ years I went from making less than $40K a year to making $70K a year and if I would have jumped ship and went to a new industry… I could have kissed that $70K salary goodbye.
Not to mention… what the hell would I have even done with my life? I knew the fashion industry. I knew corporate retail. Even with all my education I had zero clue what actually interested me.
Jumping ship would have been foolish at that point. Take a paycut and then cross my fingers, hoping that I actually enjoyed whatever new field I entered? Yeah, no thanks.
Things are different as an online business owner. You can pivot your business, what services or products you offer, where you’re located, the types of people you work with. Basically anything you start to despise about your business, you have the power to change.
The importance of pivoting in business
There are two main reasons why I believe pivoting your business is really important: personal well-being and business growth.
I’ve shared this many times: when I first started my business I was a virtual assistant, time tracking 40 hours a week, taking on a bunch of different tasks (many of which didn’t interest me), and I had worse work-life balance than I did when I worked in corporate.
It didn’t take long for me to realize that something needed to change or I’d burnout and be back in the corporate world in no time. So I decided to pivot my business and thank goodness I did!
I dropped all the clients that underpaid me, expected me to be at their beck and call, and had me doing work that didn’t fulfill me. With my remaining clients, I put them on monthly retainers that included a specific amount of work – not hours.
But the pivot that had the biggest impact was focusing more on offering web design services over general virtual assistant services. I pivoted from $500 – $800 monthly retainer packages to web design packages that quickly rose to $4,597 per project.
I also got myself to a place where I wasn’t working 40 hours a week anymore. My work week averaged around 30 hours per week and when I did the math, my hourly rate averaged at over $100 per hour.
Let’s talk about that – $100 per hour rate. When I started my business I averaged less than $25 per hour. One client refused to pay me more than $16 per hour while others paid me $25 per hour or $30 per hour. My rates were all over the place because I let my clients dictate and influence how much I charged.
The two things that impacted my hourly rate increasing so much were moving away from hourly packages and taking on more web design clients.
I made $30K in 6 months by offering high-ticket web design services. Add that to the income I was making from the two virtual assistant clients I had at the time, I was consistently making over $5K per month while working only 30 hours per week.
I experienced major business growth after making the decision to pivot.
Pivoting business strategy
While pivoting can dramatically improve your personal well-being and help grow your business, it’s not easy to do. Making the decision to go in another direction can lead to one of three things happening:
- It all runs smoothly – you work less and make more money
- Your work-life balance gets even worse but your income increases
- You get better work-life balance but lose some of your income
Outcome two and three are more likely than outcome one because of how business owners go about pivoting.
Many people believe pivoting means making the decision to either drop what you’re currently doing and going all in on the new offerings (which leads to a loss in income) or adding the new services on top of what you’re currently doing until the new services make a full time income (which leads to worse work-life balance).
This is the wrong way to go about things. There’s a better strategy for pivoting your business and it’s incrementally replacing your current income with new income.
Create your new service offerings
Before you can start replacing your old clients with new clients or old services with new services, you need to know what your new services are and how they’re going to be priced.
Rank your clients
Once you have a firm understanding of your new service offerings and their prices, you want to rank your current clients. Don’t feel bad about this – we all know you have a favorite client! Which means you definitely have a least favorite client, too.
For me, my decision was easy. My favorite client was easy to identify. To this day I still work with her even though I’ve pivoted my business a couple different times. My least favorite client was easy to identify, too. When I was able to let her go it felt like a weight was lifted off my shoulders.
So go ahead, rank your clients and be brutally honest. (It’s not like you’re sharing this with anyone!) After ranking your clients from favorite to least favorite, make a note of how much money they pay you each month. You’ll need this information for the final step.
As you land new clients for your new services, you want to start incrementally eliminating those clients that fall at the very bottom of your ranked list. Don’t eliminate before landing a new client if you’re concerned about losing income. And don’t add on new clients without eliminating old clients if you’re worried about your work-life balance.
Let’s say your least favorite client pays you $800 per month and the new client is only paying you $500. You absolutely need that additional $300, so what should you do? Move up the list and eliminate a client that is comparable in dollars but that still falls toward the bottom of the list.
Through pivoting correctly, you’ll be able to weed out those clients and work that doesn’t excite you and replace it with work that truly fulfills you. It’s a challenge but it’s one you can overcome.