Web Devs of BHW - How do you split your profit?

[DigitalWizard]

Website development can have a pretty generous profit margin if you market yourself correctly. Do you follow a specific percentage for how much you reinvest in the business for marketing, additional headcount, etc?

I own a website development company that also provides other digital services, the business is almost two years old. I have two people from the Philipines helping me but other than that my costs are low. Right now I'm at max capacity so I'll have to hire another soon but I'm worried about keeping quality to my standards. As of now I don't take anything out and am just building a balance which I'll eventually want to reinvest in the business.

Not looking for any handouts but if anyone wants to share what works/doesn't work for them in private I'd love to share knowledge!

(sorry if this is in the wrong section)

 

[DigitalWizard]

Bump, any webmasters on BHW with advice?

 

[NoobSwimmer]

I closed my Web Dev agency a year ago (6 years business) and here are my lessons: (avoid it if you want to success)

1. not focus on specific segment customer: accept all kind of clients is one of source of thousand problems you will face later.
2. price service too low: when you started you want to price your service low to compete with other but it's not generated enough profit to fit entire company then your cash flow not stable and this is a serious problem as rat race in 9to5 job every month.
3. not design a proper system/process for ... everything.
4. not focus on your strength. Eliminate/outsource/delegate tasks are not your strength or low impact.

In service based business you have to carefull manage your time because it's your money. Try to productize your service or build product will be better.

p/s forgive my English, I am not a native speaker but try to share some experience I had.

 

[DigitalWizard]

I closed my Web Dev agency a year ago (6 years business) and here are my lessons: (avoid it if you want to success)

1. not focus on specific segment customer: accept all kind of clients is one of source of thousand problems you will face later.
2. price service too low: when you started you want to price your service low to compete with other but it's not generated enough profit to fit entire company then your cash flow not stable and this is a serious problem as rat race in 9to5 job every month.
3. not design a proper system/process for ... everything.
4. not focus on your strength. Eliminate/outsource/delegate tasks are not your strength or low impact.

In service based business you have to carefull manage your time because it's your money. Try to productize your service or build product will be better.

p/s forgive my English, I am not a native speaker but try to share some experience I had.

Thank you very much for taking the time to respond! I am doing my best to get everything off of my schedule so that I can start working on my business rather than in it.

May I ask why you quit the industry? Did you get tried of it?

Thanks again!

 

[NoobSwimmer]

Thank you very much for taking the time to respond! I am doing my best to get everything off of my schedule so that I can start working on my business rather than in it.

May I ask why you quit the industry? Did you get tried of it?

Thanks again!

I quit because I thought I can't find a way to scale it. Service based business especially Custom web design is super hard to scale.
And it drains your time/energy to deal with customer support/bugs fix/scope creep bla bla bla.
If you and your team have good skills try to build SAAS or product. Don't rely 100% on service.
Now I focus build niche site to earn passive income and get rid of work with people to find peace

 

[Wiggles]

Depends what you want to achieve.

I would slightly disagree with not going with a niche as it's easier to position yourself as an expert on one thing. It also means you build domain knowledge so that you can run fast for clients. But you do need multiple clients as there's always the guy who eats your time, didn't pay etc...

I'd reinvest as much as you can afford assuming $1in yields more than $1 of future profit. But if you don't make much that might be zero.

 

[Deleted member 657006]

try to develop nice websites but also concentrate on monthly addons as well to increase revenue.

there many services in the misc that you can resell for your own needs for lots of profit.

think out the box what you can offer each client monthly to increase future revenue

remember this quote.

Anyone can have the best website in the world but if it can not be seen or used it useless.

everyone needs

traffic
backlinks
advertisement
seo
social media ( insta, twiter, fb, ect ect ))
images
video

you can easily scale with the clients your going to do work for with all the above ideas.

when trying to scale , offer discount or volchers , or buy 1 get 2 .....

 

[DigitalWizard]

Depends what you want to achieve.

I would slightly disagree with not going with a niche as it's easier to position yourself as an expert on one thing. It also means you build domain knowledge so that you can run fast for clients. But you do need multiple clients as there's always the guy who eats your time, didn't pay etc...

I'd reinvest as much as you can afford assuming $1in yields more than $1 of future profit. But if you don't make much that might be zero.

try to develop nice websites but also concentrate on monthly addons as well to increase revenue.

there many services in the misc that you can resell for your own needs for lots of profit.

think out the box what you can offer each client monthly to increase future revenue

remember this quote.

Anyone can have the best website in the world but if it can not be seen or used it useless.

everyone needs

traffic
backlinks
advertisement
seo
social media ( insta, twiter, fb, ect ect ))
images
video

you can easily scale with the clients your going to do work for with all the above ideas.

when trying to scale , offer discount or volchers , or buy 1 get 2 .....

Thank you both for your suggestions! I do have a main site that I spent most of my time on but then I'm also branching off into niche/residual income websites/services. Most recently, looking into additional SAAS ideas.

I quit because I thought I can't find a way to scale it. Service based business especially Custom web design is super hard to scale.
And it drains your time/energy to deal with customer support/bugs fix/scope creep bla bla bla.
If you and your team have good skills try to build SAAS or product. Don't rely 100% on service.
Now I focus build niche site to earn passive income and get rid of work with people to find peace

Thank you so much for your suggestions! I am currently working on some SAAS ideas but they're on the back burner for now. It's difficult to dedicate time on those other projects right now when I have so much of the other business. I do have a content creator and a developer but we're all pretty busy as it is.

@NoobSwimmer Do you think I should hire an additional developer specifically for the purpose of branching out the business via SAAS projects?