Aspiring entrepreneurs often get their feet wet launching service businesses. Product-based businesses are hard to launch, in the sense that a business owner needs to work on building a product along with finding suppliers and distributors before they can start making money. Service businesses, on the other hand, often cost less to get started. In short, service businesses come with fewer overhead costs and a higher ROI, at least in the early stages.
Competition for service-based businesses can, however, be brutal. Most businesses in such industries target a local customer base. Word of mouth marketing and branding often play a massive role in determining who becomes the market leaders. In other words, a new entrant may find it quite difficult to penetrate the market that’s dominated by brands that have been around for years or even decades. In this article, we take a look at a few tips that can help a new entrant hit a home run in a service business.
Invest In Yelp
The first step for any service-based business is to establish a presence on Yelp. With more than 150 million unique visitors each month, Yelp is the undisputed leader when it comes to local business. The platform thus provides a place where new entrants can be found by prospective customers in their area. There are two ways to find success with Yelp: the first strategy is to use Yelp’s advertising options to position yourself at the top of the business listings for your service category. This can get expensive over time, so the second, more sustainable route is to invest in building a brand for your business on Yelp. Encourage your customers (the happy ones anyway) to submit reviews on Yelp, because over time this can help your business build a positive reputation that’ll help you grow.
One popular study conducted among consumers who reach out to businesses found that the likelihood of a lead conversion was 21 times higher when this lead was contacted within five minutes versus 30 minutes after lead submission. In the absence of a telemarketing team, the business owner risks losing a significant number of inbound queries that arrive during business hours. To keep costs manageable, however, it’s recommended to hire a third-party contact center agency who can handle your inbound leads and queries.
Make use of technology
The low cost of operations make service businesses a lucrative opportunity for an entrepreneur. However, without an infrastructure to scale, such businesses stagnate, surviving but failing to grow. It’s important to invest in technology tools that can help your business scale. Make use of appointment scheduling tools like Genbook or Calendly to set up appointments with customers. If you already have employees on your payroll, you can organize and track the various open projects, assign workers and monitor progress, as well as track your equipment with CMMS software (Computerized Maintenance Management System). Handling a similar volume of tasks in the absence of such tech tools can be inefficient and grossly ineffective as well.
No matter how hard you try, it’s not always possible to satisfy each and every customer you work with. Some of these disgruntled customers may take to social media or third-party review sites (like Yelp) to complain about your business. Not only does this affect your ‘star ratings’, but this can also potentially stop other customers from hiring your service. An effective reputation management service not only positions your brand as the most trustworthy and legitimate provider in your market, but also effectively engages with disgruntled customers. This way, you not only protect your business from unfair low ratings, but it also opens up a window for prospective new customers to see how you treat unhappy customers.
We’re barely scratching the surface when it comes to tips that can effectively help a business scale their service-based business. Are you an entrepreneur in this segment? Share your other tips in the comments.
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