That time I lost $1000+ in monthly recurring revenue overnight (And what I did about it!)

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In the middle of last year, I had the perfect storm.

There I was, working away like normal. Until the emails started rolling in...a few clients needed to stop or pause retainers for one reason or another. (Like: they lost a huge client themselves and were forced to decrease expenses. Um...That means me.)

Over the course of a few days, I lost about $1000 in monthly recurring income.

Losing a retainer is one thing. But when we cross into 4 figures? You start to feel that in your belly, you know?

I was stressed. I worried obsessively - "what if *all* my clients cancel?" I considered closing down the business totally. I researched daycares, because obviously my son was going to have to start attending. *eye roll at myself*

I let myself wallow for a day or two and then I got to work. That month ended up being my 2nd highest grossing month ever, up until that point.

Woah. How? I'll tell ya...

I took action, worked like crazy, and brought crazy value. I changed my mindset, and I learned about myself.

The entire experience ended up being one of the best things that ever happened to my business.

So here's what I did to protect myself and my business from facing sudden disaster ever again:

 

1. I started managing my expectations

The first thing I absolutely had to do was to make peace with entrepreneurship. I'm on the structured, "Type-A" side. The hills and valleys of small biz ownership are just not exhilarating to me. But when I decided to just become "OK" with the fact that retainers would start and stop - that nothing was guaranteed - I felt a lot better about the situation. Granted, you can never plan for a perfect storm situation - you just don't know it's coming. But you can learn to expect and accept changes. 

2. I enforced my contract

Previously, I had been very lenient with the stipulations in the contracts I had on file with my clients. I worked out of scope all the time, and I did not remind them of the time limit for when they needed to cancel a retainer. Meaning, I had left myself vulnerable to last minute changes because I was not being rigorous about protecting myself. 

It's OK to be flexible - that's sometimes one component of great customer service. But just make sure you're comfortable with the situation. For instance, I know a lot of biz owners who have a 30 day retainer cancellation notice. That just doesn't feel right for me, and the people I serve, so mine is 15 days. I thought about changing it when this situation happened, and did for a while, but right now I'm more comfortable with 15. And that's OK. 

3. I decided to quit my aversion to one-offs

In 2015, I switched from biz model from mostly one-offs (one-time projects), to retainers. I talk more in this post about why and how I did that. For now, I just want to point out that I was nervous about bringing on one-offs again. I worried about having to manage more client relationships - would the people I brought on be difficult? How would I manage a mix of one-offs and retainers? What would my work load (and work flow) look like? What started as just a desire to make some quick cash, ended up being a great decision.

My first love in business was the opportunity to serve a lot of people, and to watch them leave with their problem solved. I love my retainer clients, because we get solve their problems over and over each month. But this experience taught me that a healthy mix of both if where my happy place is. 

4. I asked for help

Some of my biz BFFs told their contacts that I had availability, and that brought me a few one-off projects. I contacted past clients and asked if there was anything I could help with. And I asked a few of my current clients at the time if they had anyone they could refer me to. This brought in some work, and was good practice for me. I'd never done "cold" emailing like that before, so it was a nice experience. (Some of those ideas came from Freelance to Freedom Project School's Rush Challenge. Click here to learn more. <<< affiliate link)

5. I diversified client acquisition 

I looked for other places to network with potential clients, rather than sticking to my usual stops. I attended in-person events in my local area. And I became a Certified ConvertKit Expert, so clients are being referred to me. I had been previously worried about the fact that my clients were mostly coming from Facebook Groups and referrals. I had already felt pulled to branch out; to meet more people in more places. And this was a nice push. 

 

I know this is a full post, but this really represented a much-needed change in my mindset around my business. The experience had a lot of lessons for me. And, like I said, it ended up being a great experience in disguise.

Have you experienced something like this? How did you handle it? I would love to hear!

 

 

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