Just Lynni

Getting out of a rut: Why buy the cow when the milk is free?

By Lynni Megginson -- Home Accents Today, 4/1/2005

In the wonderful world of retailing, I often find I spend the majority of each day trying to compress three days of work into an eight-hour sliver of time. Whether it's personally delivering Mrs. Smith's hand-painted credenza that was on back order for three months or supervising an accessory installation that Mrs. Jones simply has to have done before her party the next night.

At the end the day my head is spinning not just from what I've managed to accomplish, but what I haven't even gotten to yet. In creating a client-friendly atmosphere and cultivating sales any which way you can in this fickle economy, I think we'll all agree that going above and beyond to get and keep the sale is pretty much routine these days. However, you have to ask yourself: At What Cost?

My reality check came a month ago when I looked at my palm pilot and evaluated what I had done that week that had made money for the business compared to what I had actually accomplished — not what I had done to make clients happy or to fulfill my obligations, but what actually added to my bottom line. I had worked seven days that week, often until 8 p.m. trying to "do it all," and realized I had wasted so much time pleasing clients, running unnecessary errands, and in essence doing all of the "little" things I didn't feel I could delegate that I was running around like a chicken with my head cut off.

The reality? I had created my own monster: Pleasing clients had overshadowed the necessity of putting a value on my time. After realizing that at least half of my working time was spent "pleasing" clients as opposed to providing a valuable and billable service, I decided I could either stay in my "rut" or stand my ground and create a new plan to work smarter, more profitably and still retain my client base.

As a retailer who also offers interior design services, I have relied for years on that all powerful client referral. It's a real feather in your cap to be able to say proudly that the majority of your business is "referral-based." However, as this network has developed, it dawned on me that although my client roster has consistently increased, I have not been able to raise my rates because when I get these referrals, the client has also quoted her rate to her friend. So, instead of standing my ground and letting new referral clients know my current rates, I have taken the path of least resistance. The result? Sure, I have a new client, but I have allowed the client to unknowingly take advantage of my time. This realization made me reevaluate my actual worth.

Let's consider a 40-hour work week. If we were to take just 1/4 of that time, or two hours a day times five days a week that was dedicated to billable hours, a designer who charges $75 per hour for her services would increase her revenue yearly by $37,500, including two weeks off for vacation. Turn that 10 hours into 20 hours and you have an additional $75,000 added to your bottom line. Egad! Suddenly that trip to the Home Depot to pick up light bulbs for that chandelier you ordered for Mrs. Smith has gone to the bottom of your to-do list.

My solution? I have put all of my proverbial eggs in one "shelter magazine" basket, risking a huge sum for a full-page ad in a select regional magazine that publishes twice a year. I will be one of two designers that are featured with a healthy shelf life of six months before the next issue. I professionally photographed one of my most beautiful projects, adding in small photos of my retail store and design studio. Once those calls start pouring in, I can set my pricing based on what I know my talent is worth, not what a referral believes it to be. I will then send out carefully worded letters to existing clients, letting them know that due to overwhelming demand my prices are going up, but because their business is so valued, they will have the ability to book my services at a generous discount, say, for the next six months. The existing client feels her feathers have been smoothed, the new clients are excited about the magic I can bring to their homes, and my bank manager can finally sleep well knowing my bottom line is sure to at least double as I put my new plan into action.

There's an old saying in the South...why buy the cow when the milk is free? Hmmm, my price per gallon just went through the roof! Believe in yourself, let your talent shine, and by all means do what it takes to have your cash registers ringing all the way to the bank. Let me know your success strategies...contact me at Lynni@Lynni.net. Happy Designing!