More Business Isn't Always Good For Business

Our client had nearly tripled her revenue year over year. She shattered her goal for number of members coming through her clinic. She was bringing on clinicians at a rate to keep up with demand.... and yet, something was amiss. She had the growth, but did she have the scalability?

Follow along our journey to Milwaukee to work alongside our long-time client, Morgan Shea, as we examine how to ensure this 2-year-old business she built from scratch would be around longer than the other 3 jobs she has since shed.

In Preparation

In preparation for any of our in-person experiences, we want to develop a scope of work, have specific topics outlined, and deliverables we want to have completed in our time together. The exercise we use to determine scope of work is the SWOT Analysis. This allows us to collectively identify the strengths, weaknesses, opportunities, and threats, to which we then build a roadmap of priorities, and align those with what will be solved in our time spent together.

The client we went to see in Milwaukee had been working with us since December 2019, so we were intimately aware of the needs of her business and the vision she had for its next step. The primary areas we needed to discuss with her would be related to personnel and finances. She wouldn't know this before our arrival, but we had run some numbers and realized she likely wouldn't be in business at the end of 2022 if we didn't make some big changes.

Our Arrival

No trip post 2020 would be complete without a COVID scare. And that is exactly what we were faced with as soon as we touched down in 14-degree Milwaukee. Our client woke up with a sore throat and was getting COVID tested as we made our way to the hotel. It was a long 20 minutes while we waited to see the results... spoiler alert, it was negative!

Once we were in the clear, we pretty much got to work right away, digging into the unsexy work that delivers oh-so-sexy results! We started with her numbers. We used our unique profitability calculator to show Morgan the dire state her business was actually in. As business owners, we often see growth and assume everything is in the green. Our focus as business consultants is scalability, and Morgan's current business model was not scalable.

The Deliverables

After several hours of discussing the numbers, making suggestions of where to cut, and how to change the business model for more profit, we broke for lunch and reconvened for some more work and news that would come as a surprise to Morgan. Aside from finances, the other area we had researched and knew needed a massive overhaul was her personnel, namely, switching them from contractors to employees. This is not typically a recommendation we give and haven’t even done it in our own business. This is the difference between a coach and a consultant, we do not have a singular approach that is constructed from the way we have always done things, like a coach would. We examine all the factors at play and make a recommendation that is best suited for the client.

The information we deliver as business consultants can sometimes be very exciting, and simultaneously daunting. Especially in Morgan's case where we are telling her that the way she interacts with her people needs to change or else she stands to not have a business in less than 12 months. She had started all her therapists out as commission rate contractors, but this has since become unsustainable as the operational costs of her business increase. We worked alongside her to establish all the necessary pieces for becoming an employer, which was a necessary step for her front office personnel anyways.

The Journey Ahead

On our final day together, we were finally able to give Morgan some good news... her projections if she implemented all the recommendations we made. By not adjusting the availability of any of her current therapists, simply optimizing their time, she stands to triple her revenue and quadruple her profit by end of 2022. These were conservative numbers, do not account for any increased availability in her clinic, adding any other therapists, or adjusting her business hours in any way. She has tremendous upside from here!

Lastly, we worked on her customer journey and Standard Operating Procedure process, as these will be the next steps for her to iron out once the transitions to her personnel occur. We also discussed an impending name change, branding, trademarking, and social media/domain change.

Key Takeaways

There is a critical difference between growing and scaling. More business does not always equal more profit or even a sustainable business model. The health of a business is revealed when we dig into the numbers and can project them in a way that allows for additional expenses while remaining profitable. The future of Morgan's business needed some tough love but is now on the trajectory to be built to last.

For more, watch our video recap for this visit in our Free Resource Library here.