Make Each Client Profitable
Let’s say it out loud: from the perspective of a business owner, every cooperating client represents an opportunity to make some money. Quite often, however, these chances do not bring real profit; there is a number of reasons why it is so – and a number of solutions to solve these problems. Below we would like to present a systematic approach that could help you out in such a situation.
- Identify the issue.
- Surprisingly often entrepreneurs are not able to properly identify their most lucrative clients. The easiest and most valuable way to do so is to measure the profitability of each customer and every single project.
- Start with taking a closer look on one particular business aspect: do you sell your services at a higher price than you buy them? You will easily notice that every project comes with a different margin and there are also, unfortunately, those that bring no profit. Now try to do something extra: calculate the cost of time that your employees spend on managing a particular client or project, adding it to the ultimate price. Nobody said it would be easy, but only in this way you are able to track the real profitability of your clients.
- Treating rate per word as the sole indicator of your potential profit might be dangerous; even if your client agreed for a relatively high rate, you can be disappointed when you discover that all the management costs have turned it into an utterly unprofitable enterprise.
- Give an honest answer to one question: do you want to keep this client?
- Having knowledge on the actual profitability of every single client – with added management costs – is a key factor in achieving success. This might bring some surprising results: you may decide to terminate your cooperation with some customers.
- You will also discover a number of clients that might not be highly profitable but worth keeping anyway. Those usually include brands that are valuable as a reference in your portfolio; sometimes you carry on your cooperation, hoping for a bigger project that might come one day in the future.
- Carefully assess your situation; usually it would be unreasonable to leave such clients behind. Since translation business owners keep on accepting lots of small projects anyway, just focus on what should be done in such case.
- Reduce process-related costs.
- Small projects might be easy to manage but given how costly they are time-wise, it usually turns out that they bring little to no profit. To solve that issue, use technology to your advantage and automate the processes. Find out below how to properly do that.
- Do not fear using online tools as means of cooperation.
- Maintaining personal, professional relationships with your clients seem to be crucial for your business. Decide, however, which projects are worth of your time and attention, and may contribute to the development of a proper relation between cooperating parties. There are also small projects where it is time that matters the most – and they are unlikely to influence your relation.
- Rush-jobs can be effectively handled via a tailor-made portal; your clients would acknowledge it even more as it would give them a chance to access their files 24/7. Every request for a quote automatically generates a project in your system, saving your time and money.
- Process automation is key.
- When using an online portal, the client can choose a service they need from a pre-defined list. This helps in automating your processes and makes it easier for a client to decide which service do they actually need.
- Just imagine – a possibility to launch a project without even engaging a project manager.
- Take care of your vendors: establish appropriate assignment rules.
- Appropriate relations with your vendors are just as important as those you establish with your customers. Start with sharing an online tool with them, ensure that they feel at ease working with it and understand the real reason for using it.
- Arranging transparent cooperation rules with your vendors guarantees that most of them will feel comfortable accepting automatic job assignments. New projects will be launched faster and won’t generate any additional management costs.
- An online tool might even automatically search your database and assign a vendor. Your turnaround time has never been that short and attractive to your loyal customers.
- Last but not least: automatic delivery.
- Complete project automation means that project manager is there not to execute, but supervise. When everything goes smooth, a project can even be delivered online – as soon as all quality control processes are over.
- Project automation equals delivery time at any time of the day: during normal operation hours, in the evening, during weekends. Therefore, you are able to shorten turnaround time, achieve maximum profitability and keep on cooperating with all your important clients.
The guidelines set forth above will be of great use to monitor your standard values and improve the processes. Make the most of the modern technology, using it to your advantage – to transform your enterprise and satisfy your clients’ demands.