3 Ways Service Based Businesses Can Scale Revenue Without Scaling Labor Costs
I had the opportunity to be invited on the AgoraPulse Agency Growth chat on Twitter. I’d like to take their question and answer format to provide a more in depth explanation to the tweet size answers I gave (if you’re curious to see those, follow me on Twitter @rherochoa)
Here’s Q5: What are ways to scale revenue without scaling labor costs?
First off, I have to say I love this question because I have been on a quest to find answers to this. I’ve asked guests on my podcast and have dug into this question with my private clients.
Here are the 3 ways I found to increase revenue without scaling labor costs at the same rate:
The first is pretty obvious: leverage technology. But in today’s age, we can now leverage level 2 AI to create new assets, get over “writer’s block”, implement and make decisions faster.
How do you choose the right tool? It all depends on your budget, use case and desired outcome. Regardless of which tool you use, you’ll have to train your team to become fully effective.
The second touches on the first: empower your team with the proper knowledge and understanding on how to maximize their resources (i.e. tools, AI, and time)
Doing so will allow them to
- manage two to three more clients (multiplied by task unit can equal 6–9 more clients per team)
- have the team enjoy their work and not get burnt out.
The third way is to add margin to what you already do. Look inside your business and ask:
-which tools and vendors do we already use for every client?
-how might we form a strategic partnership with them?
-is there a referral program we can create?
What other methods have you found effective to scale revenue without scaling labor costs?