|
|
Like this article? PLEASE +1 it! |  |
|
Diversify or Focus: The Sand Pail Approach to Stable Income
| Guest post by: Melanie Benson Strick |
Article Overview: Do you experience up and down cash flow? Or worse yet, worry that one of your "big fish" customers will stop and then you'll be left high and dry? You may be missing out on a strategy for predictable, consistent income. Try the "Sand Pail Approach" and get more peace of mind!
 |
Free Download - Do You Have a "Just Get By" Strategy? By Melanie Benson Strick |
Diversify or Focus: The Sand Pail Approach to Stable Income
Do you have all your revenue eggs in one basket? It’s the classic situation many entrepreneurs find themselves in – and it’s a precarious place to operate your business from.
If you have one big client, one main offering or one key industry that provides you most of your revenue, then you have left yourself vulnerable to many forces you can’t control.
Knowing this, many entrepreneurs strive to diversify their income with information products, the “funnel of offerings” or spread themselves to thin into many different industries.
Right idea… but if you swing too far into diversification, you’ll find yourself in the land of Bright Shiny Objects.
That’s when you chase too many ideas and opportunities only to find yourself overwhelmed, stressed and with lackluster results in all areas. Plus, there is that tendency to try to be everything to every body just to make sure you always have enough business – then you just blend in like plain vanilla.
So where is that happy medium where you find the optimum approach to diversification without losing focus? I call it the “Sand Pail Approach.”
You’ve probably heard this analogy used for time management. I like to use it for ideas on how to stabilize income.
If you think of your core, high-paying clients as big rocks that fill a pail, you’ll probably notice there is still a lot of empty space around them. I like to think of the different levels of programs and services as different size rocks:
- Big Rocks –
Big rocks are your big anchor clients/projects that pay a lot of money. It could also be a joint venture or partnership that is a big supplier of business. An example of this in my business these are my Private Clients. You probably only have just a few of these kinds of clients as they take up most of your time.
Of course if even one of your big rocks goes away you are in trouble. This actually happened to me a few years back when I over-relied on two very large marketing partners. I got 75% of my referrals from them until they added a similar program – and my referrals dried up immediately!
- Small Rocks -
Think big-ticket product sales, large events or a vendor who makes large purchases from you. The small rocks fit nicely around the bigger rocks filling in big gaps.
Offer small rocks that appeal to new customers as well as clients who already know, like and trust you.
- Sand -
The sand fills in the space around the rocks as it’s quite small. These are clients that have a shorter time requirement and pay you less. They could be short turn around projects, highly leveraged group programs or retainers with very little one on one time.
A key to your sand is setting up opportunities to generate consistent income without having to sell every day. Think recurring payments.
- Water -
Even though your pail seems full, it’s not. The water seeps through the sand, filling your pail to the top. Small fee products or low-cost monthly continuity programs would be your water. I suggest having multiple water offerings that appeal to different people/buyers.
The idea here is to understand how to use this analogy in building your business model. As you explore ways to stabilize your income, and not be overly dependent on one type of revenue stream, make a list of the types of smaller rocks, sand and water that you could either offer to the current industry your serve or to other industry’s with similar needs.
Personal Boundaries: The Key to Creating Work and Life Your Way
Why You Shouldn't Keep All Income Eggs in One Basket
Stay In The Process You Will Achieve Success (The Two Frogs Story)
MULTIPLE STREAMS OF INCOME IS NOT DUMB
Earn Extra Income With A Work At Home Online Business
The 4 Simple Secrets For Creating True Wealth
The 4 Simple Secrets to Creating True Wealth
5.1 Faster economic growth could assist in diversification efforts: Economic Report on Africa 2007
One Home Based Business Income Opportunity Tip, That Will Skyrocket Your Residual Income!
Perceiving Victory
Financial Success Strategy: Diversify Or Die...Regarding Financial Success, One Of Anything, Leads To Negligent Fatality!
5.1 Determinants of diversification in Africa: Economic Report on Africa 2007
Starting an Internet Online Marketing Advertising Business
Wanted: jobs for Africa’s youth - Diversification
HOW TO “GET YOUR HEAD OUT OF THE SAND” AND FACE REALITY WITH POWER
Protecting Your Accumulated Wealth
Home Based Business - Why Have Multiple Income Streams
BILL UNTIL YOU CAN’T BILL ANYMORE
5.1 The development model should determine the optimal trade policy: Economic Report on Africa 2007
11 Important Points You Need To Know When Buying A Business
|
About the Author: Melanie Benson Strick RSS for Melanie's articles - Visit Melanie's website Click here to visit Melanie's website   101 Ways To Triple Your Income |
Related Forum Posts
Re: What are your success criteria?
- [quote="DwayneGarrett":1igrdgib]Out of curiousity, what has to be present for you to know that your business is a success?
The top three things for me are:
1. Maintaining a 6 figure income year in and year out.
2. Creating and promoting my own products.
3. Income not solely dependent upon my personal effort.
How about yours?[/quote:1igrdgib]
I would have to say mine were:
1. Monthly Residual Income that exceeds all expenses by 110%
2. Free time to create and promote my own products (relies on #1)
3. 5% of all revenues generated by my team going to feed starving kids
Now that is "feel good work".
Re: Do Women Play the Stock Market?
- Hi Aneshia,
[quote="AneshiaYS":1lz5khur]I implement a strategy for risk management[/quote:1lz5khur]
I'm glad to read this. I think it's the most important part of investing. "Diversify" and have a clear "exit strategy" - ah yes, but "following it" is the hard part and if you have a strategy to induce your clients to follow the strategy, I should think it would be an excellent service.
Re: Quote of the Day - ?"Where focus goes energy flows." - Tony
- Focus on a single task, eliminate millions of disractions
Re: Five Personality Traits of Successful Business Owners
- 1. Focus
2. Ability to Adapt
3. Hard Work
4. Good planning
5. People Skills
What are your success criteria?
- Out of curiousity, what has to be present for you to know that your business is a success?
The top three things for me are:
1. Maintaining a 6 figure income year in and year out.
2. Creating and promoting my own products.
3. Income not solely dependent upon my personal effort.
How about yours?
Share this article with your friends. Fund someone's dream.
Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.
by: Jeff Ogden, B2B Lead Generation Strategies
Best Automated Forex Trading Strategy
Build Your List with Joint Venture Giveaway Events
May 2012 Top 100 Social Media Experts to Follow on Twitter
What to measure to be phenomenally successful in business
10 mistakes of media relations
Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!
Fighting the Saw-Tooth Affect
SEO – Link Building Secrets
How to develop the best lateral thinking skills
Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.