Listen instead on your Monday Morning Drive:

Recently, a client of mine explained to his sales manager why losing their biggest account wouldn’t destroy the company. There would be no layoffs and no panic, he said. Just a return to their normal size and profitability.

This owner understands the difference between windfall revenue and real revenue.

A windfall client is someone who accounts for more than 30% of your business. It’s revenue you can’t count on, because it’s a huge job you never expect to see again.

Our industry runs on windfalls. “We had huge growth last year!” I often hear owners say. “We picked up a million-dollar job.”

“Great,” I always reply. “You were a $2 million company. That million was a windfall, so you’re not a $3 million company. You’re a $2 million company with a million-dollar windfall.”

You enter the danger zone when you start adding overhead to handle that burst of extra work. Then, when the windfall disappears, you’re stuck with expenses your actual revenue can’t support.

My client avoided this trap. He didn’t increase his company’s size; he outsourced to support the windfall. When he noticed signs that the client might move on, he didn’t have an emotional meltdown.

That’s a much better relationship with revenue than what I usually see.

Balanced Companies Know Revenue Is Fickle

Revenue comes and goes. We can’t rely on it, especially in our industry.

Balanced companies never stop selling. You can’t be balanced if your selling organization isn’t fully staffed and fully resourced. You have to sell 12 months of every year. You don’t just sell when you’re slow. You sell when you’re busy, because that reduces your slow time later.

This sounds simple. The execution is hard.

Revenue is emotional. It’s a dopamine hit. I get it. I also enjoy winning a new client.

We’re addicted to these chemical reactions. We check our phones constantly, looking for little accomplishments. We do busy work to feel good. When you’re looking for dopamine in revenue, the hits are huge and the lows are too low.

But you’re not good at controlling this addiction.

Nobody Will Pay You to Start Your Business

You learned this when you started. Nobody gave you money for a free year of developing your business. You had to get out there and sell something.

The problem is that most of us sold something, worked on the job, then got back to working on the business. That’s the challenge of being a solo entrepreneur. Each day only has so many hours.

Once you become a mature business with recurring revenue, reliable income, and a functional operation, you want to grow. More revenue means more money. If you do $2 million and make $100,000, you might make $150,000 at $3 million.

(Those are devastating results, but the point stands: More revenue leads to more net income. How you get there is the problem.)

Right now, 80% of you believe you’re in a revenue crisis. Maybe it’s short term (a slow month creating cash flow problems); maybe it’s long term (no revenue planned well into next year). Either way, your relationship with revenue is affecting you right now.

This isn’t your fault. But it is your problem to solve.

You have to put in the work to get revenue. It’s not always rewarding, but that’s why you need a fully resourced selling sphere.

Economics Are Cyclical, But Your Revenue Isn’t

We’re heading into a recession. All the indications are there. We survived on a strong economy; now we’re getting the other edge of the sword. That will affect revenue. It could reduce the revenue you’re used to having.

But that doesn’t mean you can’t get more revenue. The power is in you. You’ve got to work on your business all the time.

Your lack of revenue is not economic. It’s predetermined. Look at your sales funnel and your forecast. You can predict your revenue. You have the history.

If you’re not putting effort into selling and an economic recession pulls back business 20%, your revenue will drop by 20%. Either reduce your overhead or fix your revenue.

We have to work on revenue all the time. Even if we focus all our energy on revenue during a recession and gain market share, we may not solve our profit problem. But we will survive. And as we come out of the recession, that revenue becomes more and more profitable.

What We Learned in 2022

Remember all that revenue you gained in 2022? Some of you became wildly profitable because of a huge surge of business. Your overhead was low. You outsourced like crazy. You charged more, and customers bought anyway.

In 2024, the market corrected. Revenue demand settled down. You added overhead because you thought you were supposed to and because you were so burnt out, but you didn’t put the effort into revenue that you should have.

Many of us had a downturn in 2023. 2024 was a rebuilding year.

There’s energy you need to put into revenue. If you keep your overhead down, you can live in a balanced world.

Right now, balance should be telling most of you that your forecast is soft. You’ve got clients who aren’t ready to commit to next year. They’re hedging on their budgets for this year, which affects next year’s as well. Some shows aren’t coming back.

All of these signals should be changing your response. Where do you need to put in more energy?

It doesn’t take much time to manage overhead costs. You do it already. It doesn’t take much time to manage direct costs on the business you sold. The rest of your energy needs to be spent on selling.

Quick Self-Check

What factors influence your emotions? What informs your feelings about your business? I bet it’s revenue.

Revenue is one area under your control. Work on revenue by putting energy into selling, and you’ll see results in your profit.