Solopreneurs and side hustlers are no strangers to using business cards and small business loans to help them keep their businesses afloat between paychecks. But using those tools alone isn't enough to stay in business—you're going to want to look into having more streams of revenue.
After all, it's one thing to run a $100 million company that has an off year. Slightly smaller profit margins probably isn't going to hurt you that much. But for everyone else, having a bad week can have a ripple effect that can leave a company's cash flow out of whack and working capital dried up.
Fortunately, I have some ideas for entrepreneurs looking for ways to quickly produce more income.
1. Talk to your existing clients and customers.
As noted, business cards and loans can help with cash flow, but if your revenue is drying up, you need to bring in work as soon as possible.
Tara McMullin is the founder and executive producer of small-business podcast What Works, and an instructor at video education website CreativeLive. The first thing she does when business slows down is mine her own network for new income.
“Solo entrepreneurs and freelancers are quick to jump to finding new ways of making money when things slow down, but there's typically work right in front of you if you're willing to ask for it," McMullin says.
Many of my clients have had huge success positioning themselves as consultants on LinkedIn.
—Joni Holderman, owner, Thrive! Resumes
“In my own experience and after watching thousands of small-business owners in the last 10 years," she continues, "the easiest way to get revenue flowing again is by actively engaging with your existing network and letting them know you're looking for new clients or opportunities. Instead of trying to design a new service, stick with what works and simply remind people that you exist."
That doesn't mean going to a client, sharing that your cash flow is nonexistent and begging for work. But you can tell a client you're free to take on any new projects they have.
McMullin suggests writing a personal newsletter and sending it to a close circle of contacts. This can be an effective way to stay in touch and remind your best clients (or all of your clients) that you're still around.
You can announce new developments with your connections on LinkedIn, or set up coffee chats with people who could refer new clients to you, McMullin says.
“A small investment of time in working your network can generally result in thousands of unexpected sales of the service you already provide," she says. “It might sound simplistic or even naive, but it's a strategy that's worked every time I've employed it and I think I can say the same for my own clients and customers."
2. Contact people in your own industry.
Afton Negrea owns an eponymous digital marketing consultancy based out of Schomberg, Ontario and has been self-employed for 10 years.
“Work can dry up fast," Negrea says. "Sometimes, it seems like it's in the stars, because multiple projects [will] start and stop all at the same time."
Business charge or credit cards can help out during these times (e.g. paying the bills when money isn't coming in). But you don't want to become complacent. The first thing Negrea does when there is a slowdown in cash flow is talk to other freelancers in her network who do similar type of work.
“Work from other freelancers is often warmer than cold calling or advertising for new projects, [which makes] converting into a project a lot faster," she says.
Of course, when you're buried and have more work than you can manage, don't forget to do the same and hand something off to a fellow freelancer. Besides being a nice thing to do, it's smart: That gesture may help you down the road if that freelancer calls on you for help when you're going through a slow period.
3. Look at how you brand yourself.
Maybe the problem isn't that you need to find a new revenue stream. Instead of using your business charge or credit cards to invest in new equipment or inventory, maybe you need to work on how you're presenting yourself to the world, suggests Joni Holderman. (Holderman is the owner of resume writing service Thrive! Resumes in Myrtle Beach, South Carolina.)
Does your career title need to be dusted off and looked at, for instance?
“Many of my clients have had huge success positioning themselves as consultants on LinkedIn," she says. "That's totally legit since 'consultant' is another word for independent contractor or freelancer, but it sounds so much more prestigious.
“When you post regularly on LinkedIn, folks begin to see you as a trusted friend-of-a-friend, even though they have never met you," she continues. "That makes you top of mind when they need someone with your skills."
Along with job titles, consider taking a look at your website. If it looks ancient, it probably doesn't inspire confidence. Maybe your email signature contact information is off-putting, or maybe your social media images are grainy or poorly lit.
We sometimes can become blind to how we look to others. Take a step back and consider how you're branding yourself—having better branding could help bring in more work.
4. Have your side gigs ready to go.
“It's been said that the best time to fix your roof is when it's sunny outside. That adage applies perfectly to the businesses of solopreneurs and freelancers," says Rafe Gomez, co-owner of VC Inc. Marketing, a New York City-based provider of sales support and business strategy services.
When you're busy and profitable, it doesn't hurt to keep looking for those side gigs and additional revenue streams. Same applies to getting a business line of credit or a small business loan, or looking into business cards. When things are good, and you aren't feeling desperate, you're a more attractive risk to lenders and companies.
Something bad, unfortunately, may happen, Gomez points out. Clients may cut back their budgets, they may go out of business and they may switch providers or eliminate departments. Solopreneurs and freelancers, Gomez says, should diversify their revenue streams and try to make them independent of one another before income interruptions hits.
Sometimes, to ensure things stay good, you have to imagine how things will be if they get bad.
Read more articles on managing money.
Photo: Getty Images