Not necessarily.
If you’re trying to grow a consultancy business, it can take a lot of courage to stop doing stuff that has made you money in the past. It can feel risky to throw your eggs into one basket. And even if you do decide to focus, it can be hard to choose the right area to specialise in – let alone develop a strategy to successfully grow that service line.
But although specialising your business can feel like a bold step, it’s definitely one worth taking if you want to grow fast and far. Here’s why.
- You’ll stand out from the crowd. The business development market is crammed with consultancies. Differentiating yourself from the competition is much easier if you have one clear message – rather than multiple service strands to sell.
- You’ll have better SEO. No-one looks for a generalist. Google’s algorithms offer business owners increasingly specific search so, if you want people to find you, it helps to double down on focused keywords.
- You’ll have a ‘unique selling point’. The more specialised your services, the more likely you are to be unique. With uniqueness comes the opportunity to create intellectual property that marks you out as a leader in your field.
- You’ll increase your conversion rate. When every assignment is in the same domain, your track record escalates, your sales pitch strengthens… and you win more clients.
- You’ll have a stronger team culture. Consultancies are most successful when the whole team are passionate about a topic – learning from each other, challenging each other and deepening your collective expertise at every opportunity.
- Your clients will become your best advocates. With every client you win, you know you have the resource and methodology to deliver an amazing job. This enables you to expand your creativity and deliver above and beyond – continually enhancing your IP while surprising your client (in a good way).
- Your cost to acquire new customers will fall. If you become well known for what you do, new business will come to you. Plus, your marketing budget will become so streamlined and targeted that it will deliver faster, bigger returns.
- You’ll experience the power of ‘No!’. Counter-intuitively, telling a client you can’t help them in a related area builds respect and trust. When you refuse to work in areas outside your specialism, it reinforces the belief that you truly are a dedicated expert in your chosen field.
- Your team will be more authentic. As a small business owner, you have limited resources and your team has limited expertise. Rather than bend your people into the shape the client needs, you can focus on finding the right clients that need your expertise.
- You’ll hold your price. When you know your value, and have a well-trodden delivery methodology, you can ensure that sold margin flows through to the bottom line.
There are, of course, a few caveats. Specialisation alone is not enough to build a successful consulting business. It does matter what you specialise in, how compelling your proposition is and how effectively you deliver.
At The Nub we have a 30-point proposition checklist that we use to support our clients in making this critical decision. Here are a few helpful questions you should ask yourself:
- Is the market big enough to fulfil your long term goals?
- Can you teach others to deliver your proposition?
- Do you have, or can you develop, truly meaningful differentiation?
You are also likely to face a few challenges, for example:
- People (including you) may be emotionally invested in areas that you will choose not to focus on
- Entrepreneurs are often motivated by variety and a narrow, deep proposition appears less exciting
- If your consultancy has only been operating for a short time and little market data exists, then you may need to go wide before you go deep to be sure you are headed on a sustainable path.
However, these are challenges worth working through. 94% of consulting businesses fail to break through the £5m revenue barrier. If you specialise, you have a real chance to achieve the sort of growth you’ve always hoped for.
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