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'Why my business puts a cap on customer numbers'

Adam Zuchetti
Adam Zuchetti
05 September 2016 2 minute readShare
No vacancies sign

Growth doesn’t necessarily mean selling your wares to anyone and everyone – sometimes capping customer volumes can help you achieve sustainable growth and manage cash flow.

This is the tactic employed by Paul Glossop, founder of buyer’s agency Pure Property Investment. And, according to Paul, it works very well for him for several reasons.

“We actually cap the amount of clients we bring on at any given time because we don’t want to jeopardise the service [we provide],” he explains.

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“Once [a client is] ready to find a property and we’ve gone through that first front-end aspect, we need to bat it within an ideal amount of time, find that right property that fits that strategy.”

No vacancies signPaul says a business' customer cap will be determined based on its size, capacity to manage workflows, and definition of success.

 

“I’d say, initially when we’re first kicking off, you kind of ask yourself the question ‘How much is too much?’. We figure that out pretty quickly, so once you get to the point of taking on a certain amount of clients, we know that the time frame between when a client comes to us and signs up to use our service to the point of finding a property is usually around three months from start to finish in settling and owning a property,” explains Paul.

“For us, that means that if we've got five clients on the books at any time, then we cannot physically go and source any more properties for any other clients.

“We don’t rush that process and we don’t want to say ‘Let’s take on as many as we can’. We don’t want a hundred clients at any given time, because we know straight away that delivering that service is going to be impossible.”

Asked how he determines the sweet spot between reaching capacity at a given point in time versus the need to add additional staff as part of ongoing business growth, Paul explains it all comes down to advanced planning to estimate incoming workflows based on current workflows, seasonality, market movements, as well as marketing activities.

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“We probably understand what we’ve got in the pipeline is going to dictate the future and for us we say, once we’ve done our campaign, we’ll look at what the flow-on from that is and then we’ll look at reassessing what clients we have on the books,” he says.

“Have we got revenue? Is the budget spend ready to go? And let’s sit with our digital team as well as our marketing team to say 'Let’s produce what we think is going to be the next thing that’s going to bring in the next line of clients'.”

Hear more from Paul on client attraction and balancing your own salary with business cash flow on the My Business Podcast now!

'Why my business puts a cap on customer numbers'
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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