Holvi Blog for Makers and Doers

7 reasons why you can’t live off your business

Entrepreneurship · 19/10/18 10:22 · Ella-Roosa Koivupuro

7-reasons

You’ve taken the plunge and started your own business, but something’s not quite right. Despite a growing customer base and new orders being placed, you’re not still making enough to cover your overhead (not to mention making a profit).


Here are some of the reasons you might still be in the red:


1. There’s no demand for your offer


Every entrepreneur wants their business to change the world (at least a little bit).


Unfortunately, many small businesses and freelancers fail to carry out a proper market analysis to test whether there really is enough demand for their offer before getting started. Ideas are often developed in secret and business plans written on the basis of speculation (and wishful thinking) without sufficient knowledge of the market and the competition.


So, if lack of sales is your problem, this should be your first question: Is there really a sufficient market for your product or service?


It could be that you only have to adjust your offer to get more customers interested and to generate higher sales.


The best way to find out what your target audience really wants is to ask them directly. You can do this, for example, when you interact with your customers face-to-face, in Facebook groups or in the form of a survey.


2. Your prices are calculated incorrectly


If there’s demand for your offer and you have plenty of customers, but you still can’t live off your products or services, the problem might be your pricing.


Inexperienced freelancers and entrepreneurs tend to offer their services at low prices, especially in highly competitive markets with a lot of cheap competition. On the one hand, they are afraid that they might scare away potential customers with higher prices and, on the other hand, they count on low prices to pull in new customers.


If you frequently accept poorly paid jobs, you will need to work longer hours or accept more projects to earn a certain income. This can quickly create a vicious circle in which you exhaust yourself completely and have little time for other things (while still earning very little).


Are you unsure of how to calculate your prices as a freelancer? In our previous blog post, we explain in more detail what you need to consider in your calculations.


3. You have no marketing strategy


One mistake that can be fatal to many freelancers is not having a marketing strategy. They publish blog posts on an irregular basis and advertise on Facebook, or distribute content in various social channels without having a clear goal in mind.


Of course, with such an approach, you may occasionally hit the target, but in the long run, it will be difficult for you to target the right audience and, above all, attract paying customers.


To make sure your efforts don’t just disappear on the Internet without having an impact, it’s worthwhile to proceed more strategically.


Concentrate on a few channels, but post content regularly and maintain high quality. Keep in mind what you want to achieve with every post.


Would you like more customers to subscribe to your newsletter? Or is your goal to position yourself as a thought leader in your niche?


Having a clear goal can make your marketing more systematic and prevent you from wasting valuable time and resources on the wrong things.


4. The customer’s benefit isn’t clearly communicated


Your market analysis has shown that there is a corresponding demand for your offer, but your sales are still lackluster.


Maybe you haven’t communicated the customer benefit clearly enough. In this case, you should take a closer look at your own website. This is especially important when you reach your customers primarily through the Internet.


Are the benefits clear to the customer? What sets your offer apart from your competition?


One typical mistake freelancers make in their web copy is to forget the customer's point of view. There are long lists of services, impressive resumes and various certificates, but no word of the needs and wishes of the customer.


Your customers are interested in one thing: which problem can you solve for them? This customer value should be clearly and convincingly communicated both in your marketing and in your sales pitch.



5. You are missing a clear positioning

As the saying goes, the target group “all” does not exist. If you try to be successful as a "coach for women" or "copywriter for all topics in the world", you won’t be the perfect match for anyone. The offer is far too general and vague.

By further sharpening your profile and highlighting your unique selling points, you'll accomplish several things:

  • People will remember you better.
  • You’ll reach your target audience better.
  • You’ll stand out from your competition.

So think about what makes you and your offer special, and dare to show your personality as well.


6. You’re missing a clear goal for your business


To be successful with your business, you’ll need goals. Goals help you orientate and are necessary if you want to measure your results.

This also applies to your finances. If your business is still not profitable, it may be because you manage your business impulsively without knowing exactly where you are going. Clearly defined goals help you to be more focused and strategically plan your next steps.


7. You try to do everything yourself


A typical mistake new entrepreneurs make is that they try to do everything on their own, without help.


They tinker on their website in night shifts with the help of Youtube tutorials. They do their own bookkeeping (or at least try to). And graphic design too. And customer acquisition. And social media.


Sound familiar? In the beginning, this is often simply the logical consequence of a limited budget. But, in the long term, this is not only tiresome and slow, but in many cases just counterproductive.


If you try to do everything yourself, you will hardly have any time left for your core business, and you’ll risk exhausting yourself. Give up some tasks and don’t be afraid to ask for help from experienced colleagues and mentors.


Get the right support


Regardless of the issue at hand, it is always helpful to seek advice from a professional.


Place your business under the microscope with a business coach or exchange ideas with other entrepreneurs. It may be smart to invest in coaching to get more clarity about your goals and priorities. Often, small changes and adjustments are enough to get your business on the road to success.

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