# 383 - Revenue Security - how to predict and protect your revenue (1-6 months ahead)
Well hello there!
So this week we’re into obsession #3; Revenue Security.
Just to recap, obsession #1 was liquidity - keeping enough cash in your business. Obsession #2 was profitability and having a 20% profit mindset. And as critical as these are, there’s a lead domino that feeds them both; revenue.
Life in business is full of uncertainty, so we have to create our own certainty where we can.
Revenue Security
The goal is to feel in control of your revenue by being able to predict your future revenue with reasonable certainty. It’s the key to consistent profit, cash, and business value.
It’s about answering the question, what do we need to do today that will feed our revenue in 1–6 months time. It’s getting as far upstream as possible to keep your pipeline full and growing, and your clients happy.
It means you can plan and take action with confidence. You can be calm and focussed on the important stuff that moves you forward. And it stops you making stupid fear based decisions, like taking on crappy clients because you feel desperate for revenue, or cutting staff because you can’t see far enough ahead.
What revenue security isn’t
It’s not knowing where your revenue will come from next month or quarter.
It’s having lumpy revenue; great profit for couple of months, wiped out by losses the next
It’s losing a client without warning, being too reliant on one key client, or having uncertainty on client renewals
It’s having too little in your pipeline and not knowing where your next leads are coming from
These are scary situations, and you’re definitely not alone if you can relate to at least one of them.
Stop the leaks and look after your existing clients
Don’t wait for client complaints or losses, get as far upstream as you can in proactively keeping them happy.
Bring in client risk management; every month measure your client sentiment, when you last talked to them, are you aligned with their strategy, set up Google alerts so you know when they’re in the news, set up credit check alerts, and monitor complaints.
New business
Inconsistent marketing is one of the biggest causes of unpredictable revenue.
You need to do the deep work and get clear on what upstream activities bring in your leads..
Feed your funnel; what brand awareness marketing keeps you front of mind? And what content do you put out that draws your ideal clients in?
What outbound activities bring in the best leads?
Does your website truly reflect who you are and what you do?
Know your conversion rates and how many leads per week you need
Measure and report on your full and weighted pipeline every week so if it drops you’ll see it straight away.
In short you need a robust marketing plan, well thought out, and executed consistently.
One of my consultancy clients is SO good at revenue security. They’re super clear on their upstream activities; writing a regular blog, consistent LinkedIn activity, the MD spending his time opening doors, building relationships over coffee, showing up at all the industry events, and then nurture, nurture, nurture.
When he does this the business comes in and we hit sales target. When he gets busy or distracted, revenue drops. And we know what to measure every month to make sure the pipeline stays healthy.
Being reliant on one key client
I’ve talked about this a lot before, but it’s worthy of a mention here.
If you rely on one client then YOU DO NOT HAVE REVENUE SECURITY.
Because they could leave.
Even with a contract in place, I’ve seen it many times where a large client just decides it’s game over. And as a small business there’s nothing you can do about it. They can afford better lawyers than you!
(I’ll give you some strategies for moving away from one client reliance in a future post.)
Your Action of the Week:
What struck a nerve as you read this?
Do you feel confident in your revenue and pipeline, or are you worried about next quarter?
What could you do this week that will improve your revenue security?
Take some time to get clear on your critical upstream activities that feed your revenue. Then measure them weekly and monthly so you can see they’re being done consistently.
I know it can feel hard to keep your focus on looking ahead, but the payoff of consistent predictable revenue is so incredibly worth it.