BEN TYSON: Hello.
And welcome to 2016 in the Google Small Business
Community.
My name is Ben Tyson.
And it's a new year, so that means it's time
to start that new business.
With that in mind, we've invited small business expert
and author Julie Gordon White to give us
her best tips and tricks on business planning.
Julie, thanks so much for joining us.
JULIE GORDON WHITE: Hi, Ben.
Thanks for having me.
BEN TYSON: Absolutely.
Can you tell us a little about yourself?
JULIE GORDON WHITE: Sure.
Well, I've had the pleasure of working with thousands
of small businesses over the last 12 years
with my mergers and acquisitions firm and through my book "Exit!
12 Steps to Sell Your Business for the Price You Deserve"
and my company The WELL for Women Entrepreneurs,
where we have online training, called Accelerate.
BEN TYSON: Fantastic.
Well, today, we're going to talk about starting
a service-based business.
And if it's OK, I want to start with a statistic, Julie.
According to the Bureau of Labor and Statistics,
the service sector is actually the largest contributor
to the US economy, accounting for more than 70% of US jobs.
Now, with that in mind, we know that a service-based business
is obviously less tangible than other types of businesses.
How can someone starting a service-focused business
really demonstrate their value?
JULIE GORDON WHITE: Right.
Absolutely.
Well, right out of the gate, you really
need to figure out who you're going to get the best
results for fastest.
I mean, that's critical, right?
So whatever you offer in a service,
who can you really make things happen for?
That's what's going to make your business exciting
and get traction and more customers faster.
And so the other piece of that is to really narrow down
who you're focusing on.
So I call it being a big fish in a small pond.
So when I first started selling businesses
before I got into multimillions, I sold flower shops.
I literally started a company called Flower Shop Brokers.
And then every florist in the Bay Area
knew that I was the one to go to.
And so I really recommend that you focus that niche down,
way down, so you can be the big fish in the small pond.
And then people know that you're the service provider for them.
BEN TYSON: Interesting.
Well, one of the things that's often overlooked
are the requirements of a service-based business.
So I'm curious, how do I find out what requirements there
are for the service industry?
For example, are there licensing requirements, and so on.
JULIE GORDON WHITE: Yeah.
Well, of course, every business needs a business license.
So make sure you take care of that.
But depending on your service, again, you
can go to your trade association.
That's a great place, a great resource
to find out what you need.
If it's, let's say, a senior care business, then, of course,
there are going to be permits and licenses.
So be sensitive to what you might
need in your specific area.
And refer to your trade association.
They're really going to be a wealth of information for you.
BEN TYSON: OK.
And let's talk about money for a second.
Because what I find in the service industry
is setting a price is difficult. How
do you know if it's comparable to other companies?
So what is your advice on setting my rate, as well as,
how can I create recurring revenue
to have more predictable income?
JULIE GORDON WHITE: Right.
Well, I love reoccurring revenue.
So we'll get to that in a second.
But yeah, that's one of the biggest questions
that I get-- how do I price my service?
So what I suggest is doing a matrix of pricing.
Plug in your competitor, someone that offers
something similar to you.
And then figure out, based on the landscape,
do you want to be the premium provider?
Do you want to be the value-based provider?
Or is it more appropriate for you to be the economy provider?
So figure out where you fit in the marketplace.
And then you can price around that.
That gives you a good starting point.
Now let's talk about reoccurring revenue.
So reoccurring revenue is fabulous
because it gives you consistent cash flow and predictability
in your business.
And that's a big issue for service companies,
because they're usually feast or famine-- you market it,
then you do it.
Then you market and do it.
And so it's a real roller coaster.
So finding ways that your customer
actually wants to receive the same product
every single month, kind of a consumable.
Maybe you're in IT, so it's a maintenance contract.
If you're in a product company, it's
something that you deliver every single month.
I've worked with a client that had a plant rental business.
So she went in and she watered plants every single month
and replaced the plants.
So reoccurring revenue is a beautiful thing.
We're in the age of the box of the month for everything
right now.
So every single business can have reoccurring revenue.
I highly recommend it.
BEN TYSON: Very cool.
And how can I go about scaling my service-based business
when it's just me at first?
JULIE GORDON WHITE: Yeah.
There's really two ways.
So if you want to grow with people,
then you need to have a proprietary process, so
a process that you can implement over and over,
pretty close to the same process with different clients.
So that way, you actually have almost like a product out
of your service.
And then you can teach other people.
And you can use that system for marketing, too.
It's really, really powerful.
But let's say you want to just have a very highly customized
service business.
Then you can scale with revenue and income
by charging a lot-- premium pricing, right?
So I have a client that has a company that
produces PowerPoints, but they're
five-figure PowerPoints, because there's
this amazing, incredible process they built in
to make a customized PowerPoint presentation.
Incredible.
So you can scale with process and people.
Or you can scale with customized, high-level,
premium-priced services.
BEN TYSON: Very good.
And to sum up, what is one thing that you
want every small business owner to remember before they get
started?
JULIE GORDON WHITE: Yeah.
Well, you've got to start big and think big, right?
I'm all about, grow to a million,
and, someday, sell for millions, or more.
So think big right out of the gate.
But don't be paralyzed by that.
Just start right where you are with the next best step.
And then one thing that cures all
is you've got to sell your way to success, Ben.
Sell, sell, sell.
It covers up for a lot of mistakes along the way.
And it keeps you in business doing what you do best.
BEN TYSON: Fantastic stuff, Julie.
And if you want to learn more from Julie,
you can attend her free webinar every Wednesday
at 10:00 AM Pacific, called The 21 Day Business Plan.
We'll also post more detail in the communities
on how you can sign up.
Julie, thanks so much for being here today.
JULIE GORDON WHITE: Thanks for having me, Ben.
BEN TYSON: And thank you for watching.
As always, you can find all of our content at g.co/gsbc.
And please follow us on Twitter, Facebook, LinkedIn,
and, of course, Google+.
Until next time, I'm Ben Tyson.
Thanks for joining us here in the Google Small Business
Community, the place you go to get the help
you need to succeed on the web.