Massive Revenue Growth Problems

by Jim September 25, 2019

Well another one bites the dust unfortunately! We are once again a victim of our own success with a recently attained client not wishing to push ahead due to rapid expansion. Sounds like a nice problem to have doesn’t it? Unfortunately some clients see potential dollars before potential problems. The reason we have a client vacancy description is for the benefit of both parties. We know we can drive growth, but can your business handle the associated “problems”?

What I learned

  • Be careful what you wish for!
  • Do you fit our revenue model?
  • Can your business handle growing pains?
  • Do you want growth or a lifestyle business?
  • Can you handle double the revenue?


Hey, welcome back Rankers! How you going? I wanted to tell you why some people can`t become our customers, and it`s quite simple really. They just don`t fit the model and we`ve heard it a couple of times. We had another incident this week, but think about it like this. If you have a nice little shop somewhere and it is in a nice spot, but there`s no issue with people getting to you. Maybe you`ve got unlimited car parking space where your shop is. Maybe you actually have unlimited checkouts where your shop is as well. I know it sounds crazy, stay with me. So you`ve got all this shelf space, but maybe you`re not using it all and maybe it`s unlimited. But you`re selling good products or good prices, good service and then you switch on the ad campaign. Sounds great, right? Except that it`s just you running the business and that`s where the problems start.

Be careful what you wish for!

So we`ve had a couple of businesses where they`ve been smaller businesses. It`s been usually two to three people maybe. It`s a family business, and these are the ones that typically don`t go too well on our model because what tends to happen is, is that you think you want to grow revenue quickly, right? And in the case of say this client here, which is one in point, you can see there that we`ve doubled that revenue by…well the revenue is up by 143%. So more than doubled the revenue in about 70 to 80 days, right? So we took this client on as they really, really wanted to become a client. We said, `Oh, I don`t know. Probably not going to work for you.` And then we said, `All right, we`ll just make it three to four months. See how we go. See what you think, see what we think and if it works, then we`ll work out. We`ll go from there.` So they`re exhausted. So it`s essentially a two person business, but they`re not going ahead anymore because they`ve decided that actually what they need, or want, is a lifestyle business, which is totally fine. Right?

So this is not for them because when you grow that fast, you have all these other issues. You have stock issues, you have warehousing issues. You have staffing issues. You have postage costs. You have all these extra things with staffing issues. You have to bring on more staff. Is it going to mean Superannuation, WorkCover, PAYG, all these other things that come into play, which maybe weren`t part of your original plan. So if you have a lifestyle business, just be careful about certain things that you could be doing on your site. Because in the case of this client, we haven`t finished! This is the incredible thing with this client. We haven`t started working on mobile yet and 61% of their traffic is actually from mobile. These numbers have simply been achieved by making a different path to purchase available on the site that wasn`t there. So now, 45% of that revenue is only coming from 12% of the traffic. So we haven`t even begun to move the rest of the traffic into that path to get it up to, say maybe, 24%. So it doubles again or something like that. But you see the issue that you can have if you might actually get what you wish for, which is a lot more revenue. It comes with a lot more issues.

Do you fit the profile?

So you need to go into these things eyes wide open, and that`s why we wrote a client vacancy description. It`s a bit like a job vacancy description. It was more to help us understand the types of business owners that this product or service would work well for. I`ll put the link in the description below and you can have a look at that. But essentially what we look for, is people that are doing maybe 1 to 3 million, something like maybe three to five. There`s different brackets, but you want to be doing enough revenue over the course of 12 months that you`re ready to double, right? So we look to double revenue over 12 to 18 months. This one obviously a lot quicker. So, and it wouldn`t have been sustainable to grow over 12 to 18 months because it`s a smaller business. So you need that sort of larger or more revenue coming in over the course of the year to make this a worthwhile exercise to do.

The other thing that the client description talks about is finding businesses where we can deal directly with the owners. So some people have said to us, `Oh, why don`t you go and speak to the brands about this.` Well it`s like, `No, this won`t work on brands either.` Because those, it`s a bit like trying to turn the Titanic around; they are big things to steer. This has to be a dynamic environment for it to work. So we have to zero in very, very carefully on who the right client is. Hey, and if that`s you and please have a look at the client description. Because we`re always looking to work with great people and we have a vacancy now. Thanks very much. See you next week. Bye.

Jim’s been here for a while, you know who he is.

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