Agency Profit: How to Eliminate Leaks that Drain Agency Profit
Is your goal for your digital agency to increase your agency profit but are finding leaks within that are preventing you from achieving your goal?
In today’s episode, we’ll cover:
- Why scope creep happens and how to put a stop to it.
- 5 ways to scale your agency and eliminate the leaks that drain agency profit.
Today’s guest on The Smart Agency Master Class is Charles Studt from Redbooth, which is a project management tool and so much more. Charles shares some amazing advice on ways to make your agency run more efficiently so you can maximize time and profit. He also talks about ways to eliminate the biggest profit drain of ‘em all… SCOPE CREEP.
Why Scope Creep Happens
Charles says most cases of scope creep is not due to an over zealous project team or a super demanding client. In most cases, it’s an agency’s lack of documented processes and lack of client education.
Without a clear definition of the project and deliverables, there’s too much gray area. So, when a client asks for a little something extra an agency instinctively says ‘yes’ without having a plan in place for tracking and billing for it… and the scope creep monster rears its ugly head.
[clickToTweet tweet=”The best way to eliminate scope creep is to prevent it from happening in the first place. ” quote=”The best way to eliminate scope creep is to prevent it from happening in the first place. “]
That means you have to have a very specific client onboarding process which spells out what is (and is not) included in their new project.
Do you have a documented client onboarding process? Is it consistent and repeatable? Having a process in place is just one of the 5 Steps to Prevent Scope Creep. And, if you have a client onboarding process, it will be your point of differentiation and part of your value statement.
5 Ways to Scale & Grow Agency Profit
- Avoid scope creep and create upsell opportunities. Consider your core service and figure out what services you offer that compliment it. Make sure to spell out these “optional extras” to your client so that when they throw you a “special request” or “quick 5 minute change” you are prepared for handling it and charging for it.
- Become more efficient with your project documentation. Manage your client’s experience with technology so you can keep a project moving. There’s nothing worse than digging through old emails trying to find the one with client approval. Using a tool like Redbooth manages communications, status, revision cycles at a glance.
- Manage your team more effectively. Charles says that the average employee wants to spend 6 hours per week with their manager in order to feel effective. In a small agency, that level of personal attention can be difficult to achieve without adding to your team. A PM tool can be a great way for managers to be involved in the details of a project, while eliminating time consuming status meetings.
- Treat yourself like you treat your clients. Internal processes are just as important as client-facing ones. Using a tool like Redbooth can streamline routine HR functions like time-tracking, new hire onboarding, weekly team meetings, annual reviews, etc. In fact, Redbooth has customizable templates that help create and document processes so you’re not reinventing the wheel every time.
- Get projects completed (and therefore paid) on-time. Ever get tired of waiting for the client to provide feedback or approval? Charles says Redbooth has a feature that allow you to communicate with your client via automated emails, mobile push notifications and real time, in-app instant messaging. Deadlines and tasks can be flagged, users can be gently reminded and you will get more done.
I’ve checked out Redbooth and it’s a pretty fantastic tool for agencies. You can check it out for yourself FREE for 30 days by heading to www.Redbooth.com/Smart. Enroll in your trial PLUS get the agency templates such as: client intake, end of project, social media marketing, agency management, and more… all for FREE.
Creating a Better Agency
Creating a solid strategy to grow agency profit can open up many doors for you as an agency owner. By evaluating other areas of weakness within your agency, you can create a better business and improve as an agency owner. And the best thing about it is, I can help you get through all of it.
I can give you support and advice on many topics from what to do when you want to speed up sales processes, ways to increase your business profit margins or how you can build an authority for your agency.
Growing your agency can be a major struggle for any agency owner and I can show you the different phases of growth you will experience, how placing a process for performance based pricing can be the best pricing strategy for your business and the three questions you need to ask yourself to sell more!