Services businesses suck
If you're thinking about starting a services business, think again. Here's why services businesses suck, from my experience running a very successful security services business for many years:
- You're constantly chasing payments.
No matter how well you manage your finances, it's inevitable that you'll end up chasing payments from clients at some point. This can be a huge drain on your time and energy, and it's not a good way to run a business. You should be able to focus on growing your business, not chasing payments. If you're not able to do that, you're not running a business, you're running a job.
- You're always on the clock.
When you're in the service industry, you're always working. There's no such thing as a 9-5 workday, and weekends and holidays are often spent working catch-up. This can be extremely exhausting, and it's not a sustainable way to live. If you're not able to take time off, you're not running a business, you're running a job, and you're not going to be able to grow your business sustainably. You need to be able to take time off, and you need to be able to delegate work to others so that you can take time off.
- Your income is never guaranteed.
Even if you have a steady stream of clients, your income is never guaranteed. One slow month can quickly turn into a financial crisis, and this is a huge stressor for any business owner. Knowing that your income is guaranteed is a huge relief, and it's a huge advantage of running a SaaS business, where you can predict your income with a high degree of accuracy.
- It's hard to scale a services business.
If you want to grow your business, it's going to be difficult to do so without adding more staff. This can be a huge expense, and it's often not worth it in the long run. Fundamentally, services businesses are not scalable, and they're not a good way to build a business that can grow sustainably. If you want to build a business that can grow sustainably, you need to build a SaaS business, which is infinitely scalable provided that you have the right team in place and the right processes in place to support that growth.© Jonathan Haas.RSS