Finding and keeping customers is hard. The problem with describing this part of running a small business is that every small business is different in this respect.
Customers will establish your reputation, which will bring other customers, but how do you get your first batch, it’s the proverbial chicken and egg problem.
Instead of giving you a set of ‘must-dos’ I’m simply going to list those things that seem to work for me, you’ll have to modify them to suit your own situation.
To me the process of finding and keeping customers is analogous to how a farmer works his fields. There is a time of plowing (calling) and seeding (small odd jobs, keeping an eye out for your (potential) customers), and to get as many other people to be keeping an eye out for you as you can manage.
Then the life cycle of the contact progresses to a more fruitful phase, and you get to do some work and send an invoice. However, unlike the farmer, you don’t stop seeding, that’s an ongoing affair. Sometimes contacts go stale, for instance because someone left a company they worked for, if so ask if they left an email address (not ok in all cultures). If you have their private email address then ask them where they’re working now, and who their follow up is at the old company. Like that you may be able to turn one cold contact into two live ones.
Finding new customers:
- Let people know
It seems obvious, but I really let people explicitly know that I'm available. Not just people that I want to work for, everybody! My family, my friends, customers from long ago, my neighbours. If that sounds over the top, each of those has in the past led to landing a fairly major job. Once you're established, you can add to this everybody you've ever worked for, even if they've changed companies in the meantime. I keep a very extensive file of people, contact information, a short description of how I met them, who referred them (if anybody) and what we've already done together and whatever other information might come in handy in the future.
That doesn't mean I spam lists of email addresses to get my next gig, what it means is that I see customer relations and finding work as one and the same. It's a continuous process where you send out little feelers through your contacts and you try to sense where you can be of assistance. Sooner or later that translates in to work.
I don't charge for everything I do. Plenty of times a job is very small, and if a customer has some standing with me then they're more than welcome to pick my brains or ask me to do a bit of research. And most of the times that that happens I tell them it's on the house. For me the critical points are: do I have to drop something in order to do this, is it going to take more than 2 hours. Phonecalls are free anyway. Like that I don't look like a beancounter to them.
Not that there is anything wrong with wanting to get 100% of your time billable, but you'll never ever manage. And the perception is that you'll charge for every little thing, not a good image to have. Get your profits from the real jobs, be lenient with the small ones. And feel free to say that, sorry but you are working hard at some other job right now, but if you can answer the question a bit later then you'll do it. If it's free then nobody is going to be upset, and if they want it now, well, then you may just have to charge them anyway.
- Cold contact
This is the hardest way to get in the door of a new customers, but it is the most satisfying when it happens. I do this very rarely because I reserve to 'pitch cold' only for those situations where I'm uniquely suited to solve a certain problem, usually because I already have a pretty good idea about what should be done.
This would mean that I can convince a customer almost right away of my value. My standard pitch is a very brazen one: "I'll solve your problem, it's free if I can't, regular hourly rates if I can, you keep the clock". So far it worked every time. The reason why is simple, I only do it when I get the wind of someone being in serious trouble, I offer a risk-free attempt at righting what is wrong. That's a pretty hard to refuse proposition.
The interesting thing about this strategy is that it gives people something to talk about, and apparently they do because invariably such a job leads to others, referred by the original customer or at the same company.
- Build a reputation
For me the two items that get me jobs are that I work extremely well under stress when projects are already dead in the water I can - most of the time - rescue them and save face for everybody involved, call it 'troubleshooting'. A second specialty I have is that I can drop in somewhere and within hours I can be asking the right questions about how a business has its main IT projects set up, to help get stuff unstuck or to tell them whether they're in good shape or on life support. It's rare that such a job would come available in my surroundings and I won't be the one to get it.
Whatever your specialty is, make sure that you make it plain that there are things that you are really good at. It doesn't matter how arcane or specialized the subject is, in fact the more specialized the better, it means that you are probably going to be operating without any competition in that particular niche.
Specialty, panic jobs are never refused, even if I have to work double time to get them solved. If someone is in trouble, I'm there for them, anytime.
This kind of job cements the reputation (and the relationship) further and they are without exception very well paid jobs that leave a hugely favourable impression. Very well paid doesn't mean that the customer gets ripped off though, it simply means that the rate that gets charged is reflective of the urgency and the amount of overtime that goes in to the job.
- Referral fees
I offer a standing reward of 12% of whatever I make on a customer during the first year as a referral fee. This can add up to serious money, there are two people out there that have earned a pretty penny for the simple act of keeping an eye out for me. I'm the happy one though, most of these customers turned into repeat customers and have been so for multiple years now.
Whenever a bill goes out to the customer I keep an eye on the bank, the day that the payment comes in an email titled 'request for referral invoice' goes out to the person that brought the customer, with the exact amount the customer got billed for, a reminder of our agreement and the amount I owe them. If they don't invoice within two weeks I'll call them. I always insist on paying, even if the amount is small. It's a great way to get people to be active participants in the funnel that pushes work my way.
There are people that are really good at 'networking', I'm not one of them. But I do know people that are, and I've gone out of my way to find them, and to make sure that our relationship is mutually profitable. I've found them in many different places, here are some of them: parties, trade shows, online fora, the users of my websites. I'm sure that your list will be different but the principle remains, where ever you have a group of people concentrated there are either a few potential customers, or people that know potential customers, ask them how business is, if they ask how yours is you can say the standard 'fine' or you can tell them you're looking for work in your line of business. The first answer is a polite empty noise, the second is an active attempt at engagement, it might lead to a more interesting conversation and it might lead to a job.
- Work the network
Whenever I have to drive a slightly longer distance and it's during office hours I have my cell phone next to me (with a headset) and I cycle all my business contacts one by one to see how long ago we've had contact last. If it's been too long ago (say more than 60 days) since I last had contact with someone I'll give them a call, simply to ask how business is. And how that last job I did for them is working out. If there is an item in the news that is directly relevant to a person in the field that I'm working in I'll alert them to it, just a 5 line email. Not soliciting for work, just a simple hi, have you seen this, I thought it might be of interest.
Think of that phase as planting seeds.
- After sales
My door is literally always open, my cell phone is on 24x7, if an email is related to business at hand it gets answered immediately (or as soon as I get to my inbox).
If someone has a problem I’ll help them as soon as is physically possible, this sometimes involves a lot of work where it isn’t clear that I should be even doing the work. No problem, first we get the problem fixed, then we’ll figure out who should be billed for it, or if there is even going to be a bill.
- Consultant means advice
My favourite spot is ‘in the loop’, the place where decisions get made, fairly high up in an organization. That way I don’t have to work my way up bit by bit to the people that sign the checks, I like to know them personally and I work very hard to make sure they’re happy. If they need advice they know where to find me, day or night. Some companies have been ‘friends’ for years before the first real job came through, in between it was just small stuff, a question here, a couple of hours there. And then suddenly they are looking for a person that can fix things quickly, cost not a problem as long as the job gets done.
- Fixes are free
I have a reputation to keep, it says ‘on time, within the budget’. I’ve had one customer in the last 15 years that wanted a discount after the fact, I told them to tear up the bill. If a customer is not aware of the value of the item he’s buying I’d rather not have that customer.
For everybody else, if it is anything less than perfect the problem is mine, there will be no bill. I’m in software and if there is one thing I really dislike of that world it is the habit people have of making more money from their own mistakes.
By setting myself apart like this I tend to have a very high stickyness, people know that they’re not going to be billed for one minute over the agreed amount, and that if I’ve messed up (which occasionally does happen) either in the software I wrote (bugs) or in the planning (overtime). That’s my problem, the customer will never ever hear me about those things. And next time I’ll try harder still, and I’ll do my best to figure out how that bug managed to slip past me or how I managed to estimate wrongly.