In my Tuesday post, 3 Businesses you can run from anywhere in the World, one of the businesses I mentioned was a service that can be fulfilled online. While I still think finding a physical product to manufacture and sell is the ideal path to passive income, most people today are going to provide a service as opposed to a physical product. I know many who want either want to start service businesses or have started services businesses. Whether it is social media consulting, spreadsheet consulting, web design, writing, photography, music production, advertising brokers, or something else, there are an unlimited number of service businesses that you can start from your laptop.
The problem with many service businesses is twofold: establishing the business and getting consistent work. Especially if you plan on starting it as a side income/job, getting initial customers as well as making sure you have established work can be a huge challenge. Today I want to share a few ways that you can pursue work when you don’t have anything lined up.
Twitter
Anybody who checks their Twitter followers will quickly realize: there’s a ton of businesses out there. While some people get irritated at the number of businesses that have inundated social media, you should realize that this is a great opportunity! All these businesses have needs. Whether it’s help with legal, accounting, web design, marketing, you name it, they need it or will need it at some point.
One thing I started doing a couple years ago is making a list of Minnesota Businesses. Let’s say one day down the road I decide that I want to start a social media consulting business (just an example, you can use pretty much any service business). I would already have 150+ businesses I could contact asking if they needed my services. On the Twitter account for this site, Young Adult Money, I have a hidden Twitter list of potential giveaway partners, as well as a list of other personal finance blogs that I can (and do) network with.
One of the easiest way to find people who need your service is…search for people asking for suggestions of [fill in blank]. I tweeted once about needing a graphic designer and asking for recommendations. I was shocked at getting zero replies initially. When I did get replies from a few graphic designers, they didn’t direct message me, or try to email me, or ask if I had any questions. Some even just said, “yeah, I do graphic design.” *crickets*
Try searching “I need a graphic designer” on Twitter. While you may get quite a bit of junk (it IS a social media site, so this is inevitable), there’s a good chance that you could find a few clients a day.
Keep a list of businesses that need your service
I think far too many people who are offering services do not think of potential businesses that could use their services. Unless you’re a blogger, you may not realize there is a fairly big market for advertising brokers. These brokers are essentially “middlemen” who broker deals for blogs and websites. I know a few brokers who really only broker for personal finance blogs. While this is a good starting point, imagine how many more potential customers there are: travel blogs, mom/parenting blogs, fashion blogs, etc. The list is pretty much endless.
While I suggested Twitter as a good place to find potential customers, there are, of course, tons and tons of businesses that do not have a Twitter presence. A few places to find potential customers:
- Companies in and around your city – Just thinking about the number of small businesses within a five-mile radius of my house is a bit overwhelming. I could even just limit the search to a two-mile radius. Contacting these companies and asking if they are in need of, say spreadsheet or database work will likely result in at least a few potential clients. Even if your service can technically be done entirely online, they may appreciate the fact that you can meet face-to-face if needed.
- Individuals who you know need your service – This is fairly straightforward: young people generally need photographers for weddings, family photos, etc. Small business owners usually love to have some assistance in web design, social media, etc. if they can afford it. Don’t over-think! Start putting a list together and then start contacting your prospects.
- Referrals – Eventually you will want referrals to be your “bread and butter.” Initially, though, you may have to rely on some of your first clients to get your next batch of clients. People will trust personal referrals before they will trust pretty much anything else. Make sure that your friends, family, and entire network are aware that you are looking for business. Sometimes incentive programs can help too. We loved our wedding DJ so we would refer him anyway, but we get a $50 gift card for each couple we refer. This is affiliate marketing at it’s core and when done right it can work really well for everyone involved.
I like to think of this as a “golden age” of freelance writing. Okay, that may be a bit dramatic ;) What I mean is that it is easier now than ever before for writers to find and contact potential employers. If you are a freelance writer and can’t seem to find any work, yet haven’t personally emailed every blog and content site that you know of asking if they were in need of a writer, I can’t feel bad for you. If you haven’t seen Cat from Budget Blonde’s spreadsheet that shows bloggers she’s contacted, you should check it out. If you don’t have work, make a list of potential clients who you think need your work and contact them. Worst case scenario they don’t write back or don’t hire you.
Just getting started?
If you are just getting started the most important thing to do is to get your first few clients. When I did my first freelance spreadsheet consulting job, which has resulted in work off and on over the past year, I was hired by a friend who owns a small business. He said when he thought about spreadsheet work he immediately thought of me. I definitely was humbled and did not even have to seek out this opportunity. Here’s the thing, though: he knew I had an interest in automation of processes and that I had a particular interest in the technical side of my accounting job. I made it known to people around me that I had a particular skill and was continuing to develop it.
I charged well under market value for the work I did for him. The pay wasn’t important and, depending on the service, you will have to start by charging less than market value. I know multiple wedding photographers who are around my age who are now charging two, even three times what they charged two years ago. If you are good at what you do you will eventually get referral business and since you are established, can charge more.
I recently negotiated a 75% raise in my rates. I had some initial experience and was well aware that most spreadsheet consultants charge $100/hour minimum, so raising my rates (which are still far below that figure) was a no-brainer. Focusing too much on your initial rate is not going to help you long term.
If you don’t find someone through your network that can be your first client, consider focusing on small businesses and nonprofits. Again, you may have to charge lower-than market rate, but the important part at the beginning is to find a couple of companies that will be references to you and who can testify to the quality of your work. You may have to hold off on pursuing a contract with a Fortune 500 company until you are established.
A few additional tips:
Your website should be concentrated on sales – There really is no excuse to not have a great website in today’s day and age. With how easy it is to set up a WordPress blog (which isn’t a bad place to start if you have nothing else), you should at minimum have some sort of online presence that produces leads. Your website should also have the following:
- What services you do – getting specific or giving some detail can help the customer understand what you are offering
- Some samples of your work
- Testimonials – if you have any, otherwise plan on asking clients until you have some solid ones to display
- Call to action – it should be VERY easy to contact you, and in multiple ways
Don’t forget the “plumbing” of a small business – While in an ideal world your business would always be growing and you’d have more work (and money) than you know what to do with, the reality is that you may hit some slow patches. Take advantage of this time to get yourself organized. Whether it’s getting your financials in order so you aren’t staying up all night at tax time or doing some market research, there are things that you need to do on a consistent basis that don’t necessarily equal billable hours.
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The beauty of service businesses, particularly those that can be fulfilled and completed online, is that there are pretty much an unlimited number of potential clients. It may be frustrating getting established and finding solid customers, but once you have consistent work you should be able to get more referral business and have more consistent income.
If you have a service business, what do you do to find customers? If you are established and making a full-time income at your service business, what tips do you have for those just getting started?
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Photo (at top) by Blake Patterson
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Great roundup here DC. The internet has really allowed people to be able to get work that it would have taken them years to get otherwise. It has also opened up a whole new category of jobs that weren’t there before. Great use of Twitter too:)
GregatClubThrifty It definitely has provided options, that’s for sure. Twiter is where it’s at ;)
good idea about tweeting what you need. I rely more on local contacts or online “friends” because with South East Asia VAs I can’t compete.
RFIndependence Creating a personal connection is definitely a good idea. I know I’m far more likely to hire someone that I personally know. If I didn’t know anyone, though, I would hire someone who at minimum had a website with their work displayed.
Great tips. This is something I’m trying to work towards, so this advice is really helpful. I feel like an old man, but I really don’t know how to use twitter. Gotta get on that!
momanddadmoney Haha well it’s time to learn!
Great post. I’m thinking about branching out more and adding more clients. I need to make a spreadsheet and contact list and get on that!
SenseofCents Do it! Seems like you already have a full plate, but maybe you can outsource some work? “Too much” work just means time to raise rates or outsource!
This is a great post DC! I like how you mentioned the need for most small businesses needing some sort of website in today’s age. In our line of business we’re always amazed at how many businesses do not have one and it holds them back from growing. Thankfully, as long as we can convince them, that usually means business for us. :)
Nice one DC. When I was working on a service website a while back, they wanted me to setup an account for them on the freelancing sites like Elance and Odesk. They use them to find customers that need their services and then bid. If they start getting contracts and good reviews, then you can get referrals.
The bigger magic of Twitter is that it’s free. People pay great money for advertising and expensive lead generation, when there are absolutely no-cost ways to promote your business and market. Great post.
AverageJoeMoney That’s the beauty of Twitter : ) Only problem (for Twitter) is how to monetize it all when you don’t charge people to use the service….
Hi David! Thank you so much for the link back to my blog today. =D That was so kind of you! This is a fantastic post. As you know, I’m all about the side hustle and believe everyone has the ability to do this with just a bit of upfront work and motivation.
BudgetBlonde No problem! That post of yours particularly stood out to me and it totally ties into this post. Glad I could include it!
Great article! Craigslist can also be a good source of leads for growing a service business (especially on web stuff). I also think LinkedIn can be a good for getting in front of decision makers, although InMails are not free. Local meetups can also be a good once you find the right ones.
bankaffiliates I definitely have checked out Craigslist to see what others have listed on there. I was surprised at how many Excel/VBA programmers there were in the Twin Cities alone.
These are excellent tips, David. You know a lot about this subject, so it’s great that you’re willing to share it. I completely agree with you that starting at a lower rate (in order to prove yourself and get referrals) and then raise your rate is a great strategy. I think a lot of people just aren’t motivated enough to want to do the work it takes to build a service business.
CommonCentsWealth Raising my rate worked for me. Once you prove yourself it’s a lot easier to charge a fee that’s more in line with the market.
Great tips! That is a really interesting idea for twitter, i’ll have to give it a try.
ayoungpro Let me know how it works, and what service business do you have?
DC @ Young Adult Money Nothing as of yet, but I’m considering starting a side gig with resume consulting.
ayoungpro Nice! That’s a great idea!
Great post DC! One of the things you touched on that caught my attention was offering your services to a non profit. For someone that is new and wants to build a good portfolio of their work, starting with a non profit is a great idea, especially if they are a larger organization.
You could initially offer some free work and take it from there. A person could also choose to adopt a new non profit organization every year and offer to do some free work for them, even if their business is already doing well. It is a good way to give back while doing work that you enjoy.
TacklingOurDebt Nonprofits are always in need of two things: money and help! Skilled labor is a bit harder for them to utilize, but if you are on board for a decent amount of time (say, committing to three months of work on a project) I think it can work out well for everyone involved.
Lots of wonderful advice, DC. I do think this is the golden age for service providers. The internet has opened so many doors and you can find customers anywhere in the world, where once it was only in your community. The right mindset and willingness to work hard – anything is possible. Great post!
Great advice. I’m still baffled by the number of businesses that don’t have a simple website set up.
I’d never thought about using twitter for job purposes/finding work. It makes a lot of sense!