How can I scale back my business (sole proprietorship, no employees) without shutting down completely?
I'm semi-retired – that is, I've started taking Social Security payments with the intent of working fewer hours, not retiring altogether. But I'm starting to get an almost unmanageable workload and I'm concerned about making too much money. Anyone out there been in that "good problem to have" position? Any suggestions for how to scale back without shutting down?
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Dec 23, 2015
Many people only have one income source, which means that they have no real exit strategy. You might consider taking on a mail box money product that would build with modest effort over time, so you could still work sometimes, but have more of the life you desire. With the right strategy and mindset, it would eventually build to allow you to walk away from the primary business. It would be like retiring at full pay or better.
Dec 23, 2015
Try to automate and do on-line business as much as possible. Focus on quality service rather than quantity.
Dec 22, 2015
Great opportunity to be facing. Here's something I think you might want to consider. You already own the company, if you have employees, consider offering them a ESOP or provide them with SAR's. If you don't know much about either or both of these, your financial advisor can help. The Stock Appreciation Rights is easy to set up and manage, AND you maintain complete ownership of the company. Your employees run the company according to your oversight as an Emeritus Chairperson.
In the case of Employee Stock Ownership Programs, the process is a lot more formal, but ultimately provide the reduction in time spent on the business.
Dec 22, 2015
I am in the same situation. Thank you for asking this question and thanks to all who answered.
I am doing a combination of 2 of your answers.
Come the new year, I am raising my rates 25% to existing customers, and new customers will pay about 10% more than that. I am also scheduling myself off work one week per month.
In my case it's a matter of failing health, not age ( although I'm close) so I simply don't have the strength to work my current load.
I would like to hear more details on earning through giving the work to another in my field. How would we collect?
Dec 21, 2015
Any thought to selling your business to someone who could carry on your good work with you financing the sale yourself? You can set the recurring income level any way you want in how you set up payment terms and stay on-board as a part-time consultant to make the transition more palatable to your current clients. Pick the right buyer and can be win-win all the way around. The business can then continue to provide value and grow as your income remains steady and predictable and still at a level that avoids penalty.
Dec 21, 2015
Find some good colleagues to refer extra business to. They may pay you a referral fee and you may be able to run your business just on them! Become the go-to person for connecting. Just a thought.
Dec 18, 2015
Perhaps consider the literal opposite of your imagined plan and instead train a replacement. That way you can step away and keep your stake, and scale it as needs be by shares etc.
Dec 18, 2015
Hi Carol,
What a wonderful position to be in. My advice is based on what I am in the process of doing right now, which is redirecting my company to be what I envisioned it to be rather than what it became.
First on the Social Security income- if you are over 65 (at least at this time) you can make all the income you want, under 65 you are limited and the SSA gives you pretty straight forward info online (https://www.ssa.gov/planners/retire/whileworking.html) .
One effective method for reducing workload is to raise your rates to a higher professional standard. Usually this guarantees to reduce the number of clients you have while also retaining the ones that value your services the most.
In the essence of what @AmaraRose shared: This year I realized my company will not just transition into what I meant it to be when I started it, not if I also must maintain the current status quo. If I wanted to get it there I need to research and write the business plan. In order to do that I need to make some changes and make some hard choices. I'm not closing my company; I still want to keep my company name and its reputation, years in business etc. in tact for the future.
I met with my employees a couple of months in advance and told them of my plan, I offered them the opportunity to take on our clients and their work should our clients agree. After much consideration they accepted the challenge with excitement and {fear}.. lol. Our employees already work directly with and are relied upon by our clients daily so this should be a soft landing for all involved. Clients are taken care of with someone they already know and trust, and my employees are embarking on their own journey to success with my support.
Over the next months we are in-person and individually letting our clients know about the transition, I am being wished well and they are excited for the employees and their businesses even sending referrals to them already.
Best Wishes, Terry
Dec 17, 2015
The best way to do this is to check which aspect of your business is yielding profitable results as well as the areas that are resulting in a loss. I suggest focussing only on the areas that create value.
Dec 17, 2015
You've gotten amazing advice, particularly DO Magic. I believe that creating a recurring income stream based on your work is a wise idea. Then, you could have what I call an 'accordion' business- it expands and contracts based on your needs or wants based on what's happening in your life.
How about turning to teaching. You have a ton to offer and an online course can provide a nice monthly income with modest promotion. It's an accordion business, too. Turn the volume up by adding a variety of events: speaking, a live event and private coaching or a combo. Thanks to the Internet and outsourcing online there are people who can do most of it for you.
One more new wrinkle makes being an online instructor even more exciting and potentially lucrative --Roku. Lynda.com and Roku struck a deal. You can access Lynda.com courses via Roku. Imagine doing the work once then selling the course as little or as much as you want or need. I feel very strongly that anyone over the age of 55 should have sustainable, recurring income as part of their life plan.
You can also pass your business to another in your field, keeping the first 10% of payment as your referral fee.