Services businesses are at a challenging time in the industry and need a direction forward.
Services firms run on maintaining tight profit margins and keeping a workforce that can respond well to the constant changes in clients needs. Whether clients suddenly need a massive project for a new business initiative or simply want maintenance work on their online presence, a services firm will need to have their team constantly at the ready so they can start at a moment’s notice. But what happens when client demands suddenly drop?
The COVID-19 pandemic has hit businesses across every industry and many firms have found that clients are trying to reduce costs decreasing the demand for their services. As a result, services firms have felt the effects and are searching for ways to stay profitable.
But what can your services business do to stay in the black when clients want less work?
Step in Where Clients Can’t
The shift to remote work has left many businesses with gaps in their processes that they are having a difficult time filling. This is a new area of need where services businesses can provide support. From workflow management, project and resource management support, to technical services needed for the sudden shifting to a remote, disbursed team, services businesses have many opportunities to fill critical capacity gaps for clients.
Virtual Peer-to-Peer Consulting Groups
A great way to better connect with and understand the current needs of clients is to hold virtual peer-to-peer group meetings that involve multiple members of a services organization and its client business. In doing so, lines of communication can be established to deepen the relationships and develop a better understanding of current and future service requirements.
Sharpen Your Skills
When businesses cut back on the services they want provided due to a downturn in the economy, services businesses often consider expanding offerings. This can be costly. The key to remaining profitable is to invest in advancing the skill sets that already exist in their teams and developing specialized skills. In doing so, your firm can establish itself as a leader in its market, with each resource becoming a more valued and better optimized team member for improved profitability.
Establishing Your Position in Uncertainty
There are many areas that drive success for services businesses, but it is critical that your business remains focused on positioning and market leadership during this time.
According to McKinsey research, “companies are more likely to thrive if they act aggressively to capture market share during downturns rather than wait for the recovery to begin. First movers during the current crisis could emerge stronger in the next normal.”
The ability to work with clients in new and creative ways, instead of walking away when traditional engagements were no longer an option for them, can expand your market presence. As the economy rebounds and businesses begin to seek out more services once again, they’ll be more likely to work with the companies that stood with them during the fallow times. And as their services needs expand once again, so will your margins.
Be Constantly Prepared for the Future of the Services Industry
Being able to forecast your client’s incoming demands and having a workforce that is consistently prepared are critical to adjusting to a constantly changing industry, Read more in our helpful free ebook “Forecasting & Optimizing Capacity: Why the Future of Your Business Depends On It.”