The Successful Blueprint to a Failing Consulting Business

Years ago, I knew a guy who claimed he could coach companies to increase their profits – which sounded awesome. The problem was that I could never get him to tell me what he actually did. Even after going through his website and other marketing materials, I could never figure it out.

He would always give really vague, almost cliché pieces of advice (“be more efficient”, “reduce costs”, “increase sales”, etc.), but none of it was ever specific or really meant anything.

But somehow, at the end of nearly every sentence he would manage to say some variation of “make more profit”. His business was actually called “Awesome Profit Coaching” or something similar.

This always reminded me of an episode of South Park with the “underpants gnomes”. In the episode, the underpants gnomes would run around stealing people’s underpants and yelling “profit!” When finally confronted as to why they were doing this, it was revealed that this was their business model:

Phase 1

Phase 2

Phase 3

Collect Underpants

?

Profit

 

And that’s what I always thought about with that coach. He was clear on Phase 1 of “Hire Me” and Phase 3 of “Profit”, but he could never articulate how he was supposedly going to get you there.

What’s the point?

As entrepreneurs (especially those of us in the online space), we are operating in very competitive environments. For us to succeed, we need to make sure that we are being specific and focused in the products and services we provide. To my mind, those are two related but separate things.

The failure in that coach’s being specific was obvious. He could not explain what his services even were, let alone how he would implement them and why he was better than his competitors. Because of this failure, people did not buy his services and he went out of business a few years later.

But even if we are specific in what services we are offering, we also need to make sure that we are not dipping our toes into too many different industries. That is where being focused comes into play. For example, if you hire an accountant you would expect them to be able to advise you on tax matters. But what if they then try to become your financial advisor? Then try to sell you insurance policies? Be your realtor? Install plumbing in your house?

At what point do you start to question if that accountant can do any of those things well?

We don’t want to be unnecessarily limited in the services we offer. But if we try to be too broad then it will be confusing to our customers and will likely decrease sales. We need to have a reasonable number of products/services that sell and ensure those items are clearly communicated to our customers.

Any accounting, business, or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.

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