EP 208 The Ultimate Guide to Building Your Agency

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This is the Align youe True north podcast and I'm your host, Brooke Elder.

Today we are going to be talking about how you can create your own agency.

And this doesn't matter if you're just starting out as a VA or if you've been maybe an OBM for a long time and you want to start bringing more people into your business to help them.

That is really what this agency model kind of looks like.

So I'm going to walk you through the steps of what things to think about and the things that you need.

If you're thinking about starting an agency, having an agency is an amazing thing because it makes it so that way you can get more done and you can work with more clients, but it doesn't take up your time.

I remember when I first started my agency, I was running an online marketing and web design agency.

And in building that up, I remember getting clients and then I would talk with them, get an overview of what needed to be done.

I would create the project management, but I didn't ever build a website.

I never created a marketing plan.

All of that was done by my team.

And then when it was done, I looked over it.

I delivered to the client.

They were happy, my contractors were happy.

And it was amazing because I at the time was a young mom.

I had two little boys at the time, and I was able to be mom during the day.

And then at night, I would check in with my team because my team was overseas.

I would check in with them, they would get everything done and that was it.

So it made it so I could make really good money, stay at home with my kids.

And it wasn't me on the computer doing the things all the time.

It was more just managing that team.

So I just wanted to paint that picture for you because when you create your own agency, it really is creating freedom.

So the first thing that you want to do when you think about creating an agency, you want to think about how you are systematizing your business and what are the things that you're going to actually offer as a part of this agency.

So, for example, one of the things that we offered is we offered Facebook business page management.

Business pages were just barely starting to be a thing on Facebook and businesses wanted to be online.

But they didn't really know what to do.

So we would offer a package where we would manage their whole business page.

We would post on it, we will comment, we would reach out to people, like all the things, right?

So I had a SOP or a game plan that said, all right, we're going to do this, this, this.

And it made it really easy to be duplicatable.

And that's what you want to create.

You create these systems inside your business, like little mini systems of this is the outcome that someone wants, and this is a process that we take someone through and we do that same process over and over and over.

And that's one of the things that we talk about here inside the yacht club.

If you ever come to one of our navigation workshops, we talk about that.

If you are in the OPS network, we definitely go into all of the different pieces of how to create different solutions.

And so that's really what you're looking for, is creating these systems inside a business.

And so your systems are going to be thinking through what are the solutions that you're offering.

And maybe it is like I set up webinar funnels for people, or I do calendar management and email marketing and we also do like engagement on social media.

Like those are all the things.

So you're going to come up with what is those, those niches that you have and what are those outcome that you get from the different processes that you can put into place in someone's business?

So that's the first thing is thinking through what are those processes and those systems that you're going to be doing that way.

It's something that is repeatable and duplicatable.

So it's easy to train someone else to do that piece for you, and you don't actually have to do it.

So when we were doing web design, for instance, we had a template that we would use and we would have.

So we were building on WordPress.

So we had here all the plugins that we use.

And this is kind of like a base model of any website that we're going to be using.

And so we would upload that to the client site and then we could build upon that.

And that took out so much time.

It saved so much time for both me, if I was doing some of the work, or any of my contractors that were doing it.

And it also made it so we could deliver the actual website in a very quick amount of time, which is very important to your clients.

So thinking of ways that you can start systematizing, creating templates, Creating processes.

If there's something that you do right now, let's say you don't have a team at all.

If there's something that you do right now for your clients and you're doing the same thing all the time, start creating SOPs.

What an SOP is, is a standard operating procedure.

So it's a way to do something.

The easiest way to do it is to just get loom.

So L o O M.

It's a chrome extension for your computer.

You can click on loom and then it will record your scre and you can walk through and talk through everything that you're doing.

And then it creates a video that you can then use that in training.

And it also shows your contractor this is what you expect because then they can do it just as well as you do.

So thinking through how you can start systematizing the things that you're doing to then outsource it to somebody else.

All right, okay, so let's look at number two.

Number two is what are your current rates?

We will need to look at your current rates because your rates right now may be great for you, but if you have to give some of that money to a contractor, well, now maybe it's not so great.

So I want you to think about when we're looking at the revenue that you have coming in and how much it's costing you to run your business.

You want to make sure that you have really good profit margins.

So you probably don't need a lot of software or anything like that to run your business.

You can do it pretty inexpensively.

So when I was running my agency, we had just like website hosting, we had a project management system and we had a way to do like invoicing and keep track of our books.

Really, that was all we needed.

We also had like a social media scheduling software.

So that was that.

That took care of everything that we needed.

So percentage wise, it was very small.

But when we look at businesses overall, when we look at operations, your operations should be depending on the business.

But for like anyone in operations, like the businesses that you're in.

So I call it like an ops professional.

So that could be anywhere from a VA to a marketing director to an operations director.

All of those, like running those kind of businesses, your operations is actually going to be pretty small.

So I would say it could be between 10, maybe 20% of what you actually are, are spending in all of your.

All the revenue that you have coming in.

A good profit margin is you want to make sure your profit margin is around 40 to 50%.

It can be higher.

But 40 to 50% for a service based business is really good.

If you're up in that 60, 70% like you're a rock star and that means you actually could hire somebody else if that's where your profit margin is.

So when it comes to like percentages and looking at at what you're going to be paying out, you want to make sure that there's enough money coming in to cover all of those operation expenses.

Plus it's not like your client is going to be paying you money and then you're paying your contractor and you aren't really doing any of the work because you it there's a little bit of looking at are you they paying for you to do the services or are they paying for your brain, for the strategy piece of it or to able to manage that team?

So a lot of people I see, they get kind of stuck in this of where like they are taking money in.

And so like for instance when I was doing a website, websites were anywhere between three to five thousand dollars.

And then I actually paid my contractor three to five hundred dollars in order to build that out.

And I was still doing some of the design work, I was still going back and forth with the client, but I wasn't actually doing a lot of like the building.

And so that's where the 3 to $500 would go.

And I just did about 10 to 15% of what that project was.

But I only had one person working on one website.

And so that was a little bit easier.

If you are having an agency where let's say you have someone, the client has hired you and they want you to do email marketing, they want you to build their funnels and they also want you to run their social media, well you may have three different people that are doing that.

And so that's where I would look at, if you were looking talking percentage wise, I would say somewhere between 20 to 30% of what you are charging the client, you need to hold back in order to pay your contractors.

And so you want to make sure you're paying your contractors well.

And so that means that the cost to the client is going to go up.

And now if you're thinking through this and you're like, hey, I don't know if I could raise my prices that much right now.

We are going to talk about pricing and how to do all of that.

So that's coming next week.

But when we are talking about pricing, one of the things that I want you to start Thinking about is when you're talking to the client, they're not just hiring you, they're hiring your team.

And that actually is more attractive to clients than just hiring you.

And I know I had this hard time at the beginning thinking like, well, they want me.

Like they don't want my team, they want to work with me because I'm the one that's talking to them.

And that actually is not true.

I mean, they do want you, but having a team behind you just means that they actually have more people to be there to support them.

So now things aren't just revolved around your schedule.

If you aren't available, if you go on vacation, if you have sick kids, you know, all the things that happen that they're not, those aren't going to hinder the business owner's business because your team is there to help and support them as well.

So I always let people know that like, hey, you're hiring me and my team to be able to help and support you.

That doesn't mean that the client is ever, if you don't want them to ever talking to the contractors.

Usually how I run it is the business owner is just working with me and then I'm the one that's relaying to the contractors.

There are some times where it's just easier for if it's a like specific project or something that people are working on that I would have the business owner actually talk with the contractor.

Because then I don't need to be the middleman all the time if there's lots of questions that are coming up, especially if it's like I said, around that specific project.

But for the most part, I'm the one meeting with the client.

I'm coming up with everything.

I'm creating the whole project, putting it all into our, our task management system, assigning the tasks to our team, giving them due dates, doing all of that.

And so that is really like being able to project manage something.

That's something that the client is actually looking for because are going to handle everything.

Not only are you going to get the work done, but you also are going to project management that.

So I want you to think through that when you are looking at your prices.

Because of course it's not just they're getting one person.

So let's say that you decide your retainer is like $3,000 a month or $5,000 a month and with that you're going to be paying your contractors well, then you just present it in a way that, where you're telling the business owner, like, look, you're getting me, plus you're getting five other people.

So if they were going to go out and hire each one of these people individually, what would that cost them?

So that kind of helps when you are talking and thinking about your own pricing.

Okay, all right, let's go into the third thing to think about.

So the third thing to think about is how do you want your agency structured?

Well, we've talked a little bit about how I structured my agency where, like, I was the client facing one, and then I had my team do all of the work.

I would do all of the project management.

I would be there to answer questions and everything, but I was the one that was client facing.

Or is it that you want to do some of the work?

Maybe your very favorite thing is building funnels.

And so that's the thing that you keep.

You do that piece and then you have team that does everything else.

And a lot of the times I get the question of like, okay, well, I want to start an agency.

What's the first person that I hire?

I always look at what's the thing that you don't like doing for your clients first.

So if you are doing part of your package, you do social media for your clients and you really don't like doing that, you can hire someone to take on that piece of your project.

So they're running all of the social media.

So I want you to start thinking about how do you want that structured?

You could structure it to where you build up enough.

Where I've seen agencies that do this, they build up to where they are doing a million dollars a year.

And the person who started it, they just make content and they go out and get clients and that's it.

And everything else.

Once they get those clients, they have a project manager, and that project manager is the one that's meeting with the client, and then they're the one managing all the people underneath.

Like, you can build this up to as big as you want it to be.

So I want you to start thinking of that structure.

That doesn't mean that you start from day one where, okay, I'm not doing anything anymore.

And you just have your team do everything, but just know where you're going.

It's important to know the kind of business that you want to be building.

So you're building it the right way from day one.

All right, number four is contracts.

You need to have a contract with your subcontractor.

Anyone that you're hiring, you need to have a contract.

And usually they will have their own contract, but if they don't, I would have one handy that you can just use.

Pretty sure that in the resources section or in the library there is an example of contracts.

If you go under the legal resources, there's a bunch of contracts there that you can take and tweak and use those if you need a contract.

Now, we're not lawyers, so I'm just putting that disclaimer out there.

So use them at your own discretion.

But just know that that gives you kind of like a base outline if you need a contract and you don't have one.

So there's that for you.

But it's important to have a contract just so that way everyone is clear on the boundaries of what they can and can't do.

It's important to have this because then there's no like gray area.

Then you're not going to have your subcontractors like looking for like some freebies or looking or thinking that they can do something that actually is not something that you would tolerate.

So having all of that in your contract is really important.

Okay, the last one, number five is to have some sort of project management system.

Now if you are new to the yacht club, you may not know I love ClickUp.

ClickUp is my all time favorite when it comes to doing project management.

And the biggest reason for that is because it replaces a lot of things and you can do so much with it.

It's easy to use, but it also is very robust in all the things that it can do.

So having a really good project management system is important.

One of the biggest reasons that I like ClickUp is because it will do dashboards.

So that way your business owners can see everything that they are doing in their business.

They can get a good pulse on like really the health of their business right off the bat through the dashboards.

And also now they just announced that they have chat too.

So if the business owner is using project management, like maybe you're using Asana for your project management and you're also using Slack to be able to talk back and forth with your contractors.

Well, ClickUp now has chat built in, so it works just like Slack and you can talk back and forth.

You can still call each other and do huddles if you've ever done that inside Slack.

All of that works inside ClickUp now too.

So not only does it do your project management, but it also can handle all of your communication.

And it also can replace Google Docs because it has a whole doc section too.

That's the biggest reason why I like it is because I like having an all in one system.

That makes it super easy for you to be able to have everything all in one place.

And it's not confusing to like, oh, do I need to go here for this?

And, oh, I go there for that.

And, like, this is what this communication is used for.

But if you have a question about this, you got to go over here.

Like, just having everything click up makes it so much easier.