“Grow your practice without having to add any new clients!”
I seriously gasped when I saw this headline recently. I thought to myself, “Really? What kind of advice is this?!” I had to read this story to find out just what the author was suggesting and how this could be a good long-term strategy for anyone. As I read through the article, I was secretly hoping to learn some magic bullet or new idea that would make growth easier on so many people who do not like sales. However, as I continued to read, I became more and more anxious about the strategy that was suggested.
Don’t get me wrong, the author was telling a true story about how he grew his practice by over 70% without ever signing a new client. I’m not discrediting the story and actually commend him for working so hard to produce that type of growth. That is no easy task. My concern is that this strategy will not work for long-term, consistent growth and I would hate for anyone to have false hope in this strategy.
Those with any experience in sales will tell you that it is impossible to hit a sales goal upselling current customers alone. You have to add new business in addition to upselling to have long term growth. What does this mean to someone without experience in sales?
- Upselling Current Clients: While upsells are much easier to get because the client already knows, likes and trusts you, the amount of revenue is typically much less than signing a new client. Because of that, it takes incrementally more upsells to bring in the same amount of revenue as one new client.
- New Business: On the flip side, while a new client can mean a much bigger jump in revenue, it typically takes more time and effort to sell your prospect on becoming your new client. There is much more thought, activity and effort that goes into being able to navigate someone new through the process to know, like and trust you enough to become your client.
What does this have to do with the article?
The author of this article worked hard to identify and close upsell opportunities on I’m assuming a large percentage of his current client base. He saw a spike in revenue and deepened the relationships with current clients. This is absolutely a smart move and we are seeing it more and more in the industry. With firms looking to provide more value-added services in addition to the now commoditized tax or accounting services, it is necessary to find ways to deepen your relationships and find services that you can charge for with current tax and accounting clients.
The problem with this is that this is only a short-term strategy. Think about it. Considering everyone has a finite client list, what problems do you think this will present?
- How long do you think it would take to upsell all of your current clients on new services where there is actual opportunity? It might take a year or it might take multiple years, but eventually you will go through your entire client list and run out of opportunities.
- This is also assuming you are truly looking for new ways to service your clients and not just trying to upsell anything that might bring in new revenue regardless of whether it makes sense. That is, unfortunately, one of the easiest ways to lose clients rather than bring in business.
Let’s say you have a significant client list and best-case scenario, you make it a few years on upsells, but eventually run out of opportunities with your current client base. What will you do then if you still need or want to grow? At that point, you will be forced into bringing in new clients whether you want to or not.
How can you get long-term results?
I want to suggest a different thought process that when done consistently will set you up for long-term growth. In order to continuously see growth long-term, it’s important to have a combination of new business vs. client upsells. It is always important to find new ways to better service your current clients and bring so much value to the table that they would not consider leaving. This should absolutely be part of your strategy.
In addition to this, you should constantly be looking for new business in your area(s) of specialization. If you are consistently adding new business in addition to upselling, you will always have clients to upsell. Brilliant, right? Keeping this business development strategy on a loop ensures that you won’t run out of opportunities like you would in the aforementioned strategy.
In order to implement this strategy, it means we have to know where our opportunities really are and how to balance upselling current clients with bringing in entirely new business. This can be tricky even for advanced sales people and especially someone just starting their business development journey. This balance looks different for everyone because you have to evaluate your current client list and be honest with yourself how much opportunity is really there. Factor that into your growth goals and you will better understand what that balance looks like for you.
The bottom line is that it is important to put a plan of action in place that combines your upsell opportunities with a new client acquisition strategy and consistently work towards that goal with intentional actions. If you do this, you will see consistent growth for years to come.
If you want some help developing that plan, download our Long-Term Growth Guide here: http://bit.ly/longtermgrowth
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