Small Business: When Is It a Profitable Niche

Recently I took the position that for freelance service professionals, copywriters, IT pros, trainers, coaches, and so on, small business can be a poor market, although it's one that's often targeted by consultant newbies.

As a copywriter for 20+ years, I know that one can get very good business from companies with, say, 25 employees and up. And after working with the big guns like IBM, Intuit, Microsoft, and others, I've also learned that the larger the business, the better the pay and the more pleasant the work (largely due to more sophisticated processes).

That said, small business can be a very lucrative market under certain circumstances. So by what criteria should you judge small business as a potential target for your service business? There are three rules of thumb that I go by:

1. Small business is a good niche for service professionals who can provide a complete solution. A perfect illustration is found in the distinction between offering copywriting services versus a full-blown marketing solution.

Small business might balk at paying thousands of dollars for the copy component of a direct mail package, but happily pay a healthy retainer for someone who can handle 100 percent of the marketing function and deliver real, measurable results. A small business needs lots of help communicating with prospects, customers, vendors, and news outlets. This is where a marketing savvy copywriter can shine.

One of my recent coaching students wants to help veterinarians. While there are some very large veterinarian conglomerates in the marketplace, small practices dominate. The diagrammed business model I made for helping small business vets looks very different from the diagrammed business models I make for my "big business" coaching students.

For one thing, the small business model has a 100 percent focus on local prospects. On the other hand, many of my "big business" coaching students can target both local and non-local prospects.

2. The small business must have a viable budget for your services over the long term. Whereas a one-time job for a very large business might net you thousands, the budget constraints of a small business leads to a model that supports an ongoing relationship. In my own business I have consultants on a monthly payroll for IT, office management, and accounting. These people are essential to my business growth and provide services on a weekly or monthly basis.

The savvy copywriter will choose only those small business clients who understand the value of copywriting, and can afford to pay "market rate" for the work.

A common complaint of copywriters who are working with the wrong kind of small business client is "I have to spend so much time educating them." In ideal copywriter/client relationships the client does not need to be educated and the focus is on getting the work done. A small business client who wants you to educate them will drain you UNLESS you also charge for your time as a "tutor."

3. When working with small business, there is often an advantage to viewing the business relationship as a partnership. Now I don't mean an actual, legally-binding partnership, but I do mean an attitudinal one. Rather than straight "work for hire," both parties benefit if there is a shared passion for meeting goals and objectives. There is a trust factor to be established which unlocks the vault, for as you might guess, the budget appears when the value becomes apparent.

For instance, I could have hired an office manager who just "took orders." But Jackie Robinson comes from the heady world of the San Francisco-high-rise law firm. As a top-flight legal assistant for three decades, I benefit from her business acumen and her ability to see around corners. She solves problems I don't even know I have. This makes her very valuable, and as her client, I look for ways to keep her happy too, with pay raises, added responsibilities, and a stake in "our" continued success.

So the bottom line is...small business can be good business under the right circumstances.

If you love the idea of being a significant part of the team, if you like the variety of handling full marketing and publicity campaigns, if you could see yourself as the "marketing department," then small business could be your ticket to a very profitable and exceedingly satisfying career.

If, on the other hand, you'd rather come up with killer concepts and churn out blockbuster copy every day, then you're better off to target companies that already have their marketing departments in place.