What would it be worth to you to receive a steady stream of new customers with little or no effort on your part? Would you be willing to pay 10% of the revenue they generate? 20%? 50%? Or do you believe that you can't afford to pay anything?
During a recent discussion, I was surprised that people said they could not afford to 'give up' 20% in commissions to reach new customers. If you have more work than you can handle, that makes sense. However, most of the people who take this position do so because they think it is 'not fair' that someone else get a percentage of the money they believe is theirs. My question is: Would you rather have 100% of nothing, or a smaller percentage of something?
I have taught courses at several places where my compensation was a revenue share. Typically, I received 50% or less?often much less?of the fees the students paid. Many instructors think this is unfair. After all, if they are presenting the course, shouldn't they get the bulk of the money paid by students?
Break down what is actually involved in making the course happen, and it all makes more sense. The sponsor provides a place to present the course, lists it in their catalog and does other marketing (a big expense), takes registrations (including absorbing credit card fees) and handles student questions and issues. I could do these tasks, but they take time and money. Plus, I don't enjoy them. I prefer to use my resources on the part I enjoy most and do best?presenting a great course.
Instead of worrying about someone else also making money from 'my' course, I look for ways to increase the income I generate, including publicizing the class to attract more students, providing a required or optional text for an additional fee, and keeping in touch with students after the course so that they can become long-term customers.
When offered a commission or revenue-sharing arrangement, consider the following:
Do you have more of the product than you are currently selling, or the ability to create more? Do you have time to provide additional services?
Will your pricing accommodate paying a percentage of revenue to someone who will refer clients to you? If not, maybe your rates are set too low.
What does it currently cost you (in time and money) to get a client? If you spend little money but lots of time, don't forget the value of that time. Wouldn't it be better to increase your billable hours, even if you only net 80% of your regular rate for those additional hours?
What else will you get from the relationship? Perhaps you will gain visibility from the referrer's web site, newsletter or catalog. The clients referred to you may become repeat customers who do business with you for years to come (and depending on your arrangement, you may only pay commissions on the deal referred directly to you, not repeat business).
Don't overlook the value of having partners to help you grow your business.
Copyright Cathy Stucker. As the Idea Lady, Cathy Stucker can help you attract customers and make yourself famous with inexpensive and free marketing ideas. Get free marketing strategies, articles and more at http://www.IdeaLady.com/.
Okay, I'll begin by telling you that I've been divorced... Read More
Any success you have in life must begin with a... Read More
If you have seen me speak you will know that... Read More
It's your first business or the next Great Idea in... Read More
The term "Infopreneur" is a relatively new industry buzz word... Read More
More and more students, both in undergraduate and graduate institutions,... Read More
What I've discovered from most of my small business clients... Read More
The "Great One" said it bestHockey legend Wayne Gretzky, when... Read More
There are a whole range of reasons why customers buy... Read More
Dwight Payne and Gary Heap reside in Santa Barbara, CA,... Read More
They're really are powerful million dollar opportunites everywhere.Ok, let me... Read More
Communication is the key to vendor relations. In your small... Read More
The basic rule is simple: "Find a market need and... Read More
In a recent talk to the Detroit Economic Club, President... Read More
It never ceases to amaze me. Almost everyone peers into... Read More
Q: I'm graduating this year with a degree in business... Read More
Does A Franchise Meet Your Needs?Do you look forward to... Read More
Yesterday was a beautiful, sunny day in New York and... Read More
When I'm not running my own business, writing articles about... Read More
It's important to understand when to add individuals to your... Read More
Hello Creative Entrepreneurs!In the second course on Creativity & Entrepreneurship... Read More
Not having enough money for a comfortable retirement tops the... Read More
What Startups Need to Get a Business Loan, Part 2In... Read More
Isn't enthusiasm a good thing? Aren't we urged to be... Read More
A primary inhibitor of business start-up is that few people... Read More
Entrepreneurs and companies who are seeking venture capital often negotiate... Read More
I think it's fair to say that not everyone is... Read More
Most entrepreneurs constantly come up with new ideas. Whether they... Read More
What are the unique gifts that differentiate you from other... Read More
Q. I was laid off six months ago. Jobs in... Read More
Are you busy? Everyone's busy! Ask anyone they'll tell you... Read More
If you have a business idea, or an idea for... Read More
I recently read a magazine article about Andrew, a 42-year... Read More
Enjoying the title of entrepreneur is a hollow feeling.If you... Read More
Franchises offer the first time business owner a proven and... Read More
When you buy a business, you should have a plan.... Read More
The psychology of entrepreneurship can be very rewarding to one... Read More
If you are just starting a company and looking for... Read More
Not having enough money for a comfortable retirement tops the... Read More
The Department of Labor predicts that the #1 employer in... Read More
"Berkshire Hathaway (NYSE: BRK.A) to purchase Clayton Homes for $12.50... Read More
There are a whole range of reasons why customers buy... Read More
Bootstrapping in the context of business start-ups refers to the... Read More
Sylvia Acevedo needed a break from her technology job so... Read More
The first step in deciding whether to start a business... Read More
Q: I'm thinking about starting a business since that seems... Read More
In the early days of my first consulting business, I... Read More
One of the most important management tools a franchised company... Read More
Business success is essentially the result of successful leadership. Contrary... Read More
Entrepreneurs know their business. They know their product, their service.... Read More
Use this comprehensive checklist to plan each step of your... Read More
As a first time entrepreneur, there are a variety of... Read More
Having built a business from a bucket of water and... Read More
Today, I got an email from a lady who hates... Read More
The latest series in "The Apprentice" features 2 distinct group... Read More
Some would say about certain issues that the means do... Read More
Any success you have in life must begin with a... Read More
Franchise companies are not born they are made and when... Read More
It seems odd to think of a person opening a... Read More
What to Look Out For:Copyright - you absolutely must check... Read More
What I've discovered from most of my small business clients... Read More
As one of the most successful direct sales entrepreneurs in... Read More
Are you busy? Everyone's busy! Ask anyone they'll tell you... Read More
Great question! Overwhelm is very common even among the most... Read More
Many people have the professed desire to be their own... Read More
Define for yourself what an Entrepreneur is:What makes you think... Read More
Entrepreneur |