Ride the income rollercoaster - and enjoy it

Riding the income roller-coaster is not only stressful, it can impact the quality of work presented. Photo / Kristy Ballard

Few home businesses manage to avoid falling into the feast-or-famine trap, going from complete overload one week to a dearth of business the next. Larger companies also have busy and quiet times but the home business operator is more susceptible to these fluctuations as, being generally a one-person business, he or she cannot delegate any of the workload, and the cost and hassle of employing or contracting part-time assistance adds substantially to overheads and is often not cost-effective.

Riding the income roller-coaster is not only stressful, it can impact significantly on the quality of work presented or the availability of the home business owner to regular clients who may expect a rapid response to an order or query, or need work done to deadline at short notice.

When the operator is under pressure and unable to respond as needed, the business can lose a good client, plunging it back into having to win new contracts when the volume of work drops off.

More than that, because the home business person has typically been expending all their time and energy supplying the goods or services required during the peak time, he or she has not been marketing the business and often has no new work lined up when the busy period is over. How, then, can home business operators overcome the challenges of having too much work to handle one day, and not enough the next?

It's probably impossible to ensure a completely steady work or income flow if you are self-employed, but there are several steps which a home business owner can take to help even out the workflow and make life a bit easier.

Deciding whether the reason you run your own business is just to give you an income - i.e. to be self-employed - or to build a bigger business is a critical part of the equation. It will help you determine whether you would like to use any excess work to grow your business, tactfully turn it away or find ways to deal with what you can't handle.

A range of practical things you can do to manage your work and income flow is listed below. You'll find some of them contradictory - having a clear goal in mind will help you choose those that will work most effectively for your business.

• Predict busy times, e.g. if the business is seasonal - and prepare for them by having help on standby, or a plan for dealing with overflow when it happens

• Price so you can outsource tasks, subcontract or hire in part-timers to handle additional workload or administrative jobs without giving away all your profit

• Discourage clients who take lots of your time and earn you proportionally less income - and concentrate on winning more business from those who pay well, on time and with whom you can work efficiently

• Market consistently even when you are busy - and especially before predicted quiet periods or well before the end of a project if you have nothing lined up to follow it

• Tap into the efficiencies of automation (see last month's Home Business column) to gain more hours in the day without it having to cost you money to free up your time

• Educate your clients and customers. There may be times when just knowing when your busy times are can help them plan more effectively, or knowing how long a project takes from start to finish can help to ease the pressure on you

• Offer an incentive to use your services or purchase your product when you are less busy - especially if you traditionally have identifiable periods when business is slack

• Introduce a surcharge for work that has to be done to an unreasonable deadline - it often helps a client decide their work is not so urgent after all!

• Network with trusted home businesses to find others who may be able to share your workload when you are busy and pass some of theirs along when you are not

• Establish a regular newsletter or email newsletter to cross-sell your other services or products to existing customers - it will often bring in a steady trickle of business

• It's tempting to rope other family members in to help for little or no pay - before you do, make sure everyone is happy with this arrangement. It's easy for them to become resentful if they feel their time and labour is taken for granted

• Learn to say no - and mean it - when you really can't take on additional work

• Use down time on strategic planning, marketing or administration which has been on the back burner while you've been busy

• Learn to make the most of the busy times, save some of the extra income, and take time out to enjoy life when business is quiet - recognise that the ups and downs are all part of being in business!


Heather Douglas

homebizbuzz.co.nz