The 3 C’s Of Small Business Management

Are you stuck thinking about how things could be going better? Better clients, better capacity or better cash flow. These are the three C’s of any small business. Clients, Capacity and Cash.

Problems with any of these, lead to problems in all of them. Bad clients impact capacity and cash. Lack of capacity impacts clients and cash. Poor cash flow impacts clients and capacity. And it all leads to an overall unhappy small business owner.

But there is hope …

At the heart of it there are only three ways to grow a business

The first one is straight forward, increase the number of clients you serve. But you need to make sure that they are the RIGHT clients. Remember, SIWYSNT. We pronounce this as ‘see-why-zent” and it means “success is what you say no to” … do not underestimate this little acronym!

Increasing the average value of the purchase, this can be achieved in two ways. Either you can aim for maximum efficiency in doing the job so that you spend less time on it, freeing up that time to then work on other things (so looking for an average overall improvement). Or, you can just increase the price of the job itself to the client. Or, even better, why not do both?

To increase the number of times a client purchases is tied directly to what you offer your clients. Do you work on a project basis or a rolling basis? Even if you do offer monthly services on a rolling basis, where is the start and end point to allow for re-engagement? What other services can you package and offer? 

Let’s have a look at each of these 3 C’s in turn. 


Are you focusin on servicing your clients and helping their business rather than your own.  Let’s change that today. Let’s start by taking a look at your numbers, because as you know these tell the story.

Here are a few quick questions for you:

  • Do you know your small business wide, average hourly rate?
  • Do you know what your Average Receivables days are and how much money you are owed?
  • Do you know how much WIP you have locked up, in both dollars and average days?
  • Are you happy with the dollar profit in your firm?
  • Are you paid upfront or after you have done the job?

Here’s another question for you. What do you sell? This might seem like a strange question under a topic on ‘cash’ but hang in there.

Of course, the answer will be that you sell professional services. But what do you actually sell? Do you have custom solutions for every single client through the door? Do you have a fixed price list, go by gut feel or just look at how much time was spent on the job?

Believe it or not, you are actually doing your client a disservice if you bill by the hour – the reason is that it doesn’t value you, your skills and from the clients perspective gives you no incentive to reduce the hours spent on their job.

In fact, padding of the timesheet is the time honoured tradition in some of the larger, old school firms. There are even blogs about how to write up to a charge code. I mean, what is that? How does that help your client?

But in getting back to the services that you offer, do you package any of these together? How do you approach clients to sell different services? What product do you use to introduce clients to you and your way of doing business? If you don’t have these, then we really need to talk.

You might be thinking, why is there so much here about services and products in a section on Cash? It’s because profit is driven by your billing process and the mix of services that you offer. Some of the services you have will be relatively easy to implement and run and will have a good margin. Others will be more labour intensive that requires a specific skill set. These types of projects are generally tailored and non-repeatable. It will drive the targeting of the clients you take on and the support capacity you can develop.

If every single job is different, then everyone needs to be trained in that one job and if staff leave then it is even more challenging as they are taking that knowledge with them. The more productised your services, the more repeatable the process and the easier it will be to train people to get it delivered.

If your business is reliant only on highly skilled, knowledge-based staff, then you will not have a business you can scale or systemise effectively. You will always have a job. 


Who are your clients and how do you choose who you will work with? And, please don’t say….

“anyone with a heartbeat that can pay the bills”.

Having a good client selection process is key to making sure that you are working with people, businesses and industries that you like. This specialisation process enables you to become a stand out star in a niche. 

Getting clients is actually the easy part

It’s getting the right clients that is much more challenging. This type of targeting requires a specific strategy. You need to have a regular lead generation and conversion program and ideally, this will be as automated as possible.

The days of the free 30 minute, no-obligation discussion are over.

Your time is valuable. That isn’t to say that offering something free isn’t a tactic. Just that it should only be used when part of a whole customer journey designed to get that prospect to do business with your firm.

This clients section isn’t just about always having to get new clients. It is generally accepted that it costs far more to acquire a new client than it does to retain an existing one. Service is cited as a common reason for changing providers or vendors so it makes sense to focus on this as an area for regular review.

Service is defined from the client perspective and there can often be a wide gap between what you think is good service and what your client thinks. There have also been recent surveys that have said that clients themselves have both a higher standard and are likely to change over service, than at the same time a year ago. This makes ‘service standard’ a shifting goal post.

But with good management, maintaining great client relationships can be achieved. And it can often be achieved in a mostly automated way. 


Now we have covered off on both Cash and Clients. The last C is Capacity. The other two are highly dependent upon your capacity to actually deliver the work.

So what does this mean? 

It means having the right team with people in the right place doing the right jobs. Sounds simple right? What could go wrong? The reality is that hiring is one of the most challenging things that any firm will do and the cost of a mis-hire is substantial. It isn’t just the cost of the wage, it is the time that will then be spent in another round of recruitment, the never to be seen again time in training the person who left and the overall loss of productivity.

There truly is a better way.

But a lot of it comes down to how you prepare to fill your capacity. How are you selecting your talent, both administration and professional? Do you just put an ad up, wade through piles of emailed resumes, select a few to interview and then squeeze in a quick 30 minute to one hour chat with the shortlisted candidates before making a choice? What if there is a much better way?

We can show you how to make stronger use of your administration team through upskilling and better training. Use the technology that exists to create a collaborative environment between yourself, your staff and your clients. Really look at your tech stack. Is it offering the most efficient way to deliver your services?

Have you considered outsourcing?

We have a range of resources available here to help provide support for your firm, so be sure to check back as this is regularly updated.

The approach you choose for your outsourcing can determine whether this is a good model for you. There are many different stories on all types of experiences from excellent down to head-shakingly awful. The three key factors that we identified between this range of outcomes came down to expectations, communication and outsourcing firm selection. 

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