Profit Hacking 019 - Scarcity

❌ “You have 03:46:23 [countdown] to sign up or this deal goes away forever.”

❌ “Sign up within the next 3 days to get this offer, at a discount, with bonuses!”

Scarcity is a marketing tactic that moves people to buy with their FOMO, fear of missing out.

BUT, the problem is that everyone is doing it.

And when there’s enough exposure to anything, it becomes easier to sniff out if it’s genuine or a gimmick.

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Which is why scarcity is frequently used by large corporations. No one person feels accountable for the psychological games they play on the market.

Soloepreneurs almost never use scarcity for fear of coming off as a sleazy salesman. Or worse, getting called out by their market for pulling some cheap trick.

But what if you’re missing the point… the truth of your own scarcity?

The most genuine way to use scarcity is with supply and demand.

If you have demand, and limited supply, you can drive more deals at higher prices.

As solo entrepreneurs, we only have so many hours in a day to dedicate to work. So you have a built-in scarcity because of your limited supply of time.

Say, for example, you want to work from 9am to 5pm, Monday through Friday. Minus an hour for lunch.

That’s 35 hours per week.

You need to dedicate 5 hours to your personal sales and marketing.

Leaving you with 30 hours of client time.

And let’s face it, no one is perfect with their time efficiency. So let’s assume only 60% of those 30 hours are for meaningful client work.

You have 18 hours for meaningful client work.

18 hours to split between as many clients as you can.

That’s only 78 hours per month...

(we’ll round it up to 80 to cover some short lunches or extra productive days)

How many clients can you serve in 80 hours?

As a Profit and Growth coach, my clients take up 5-10 hours per month. So I can only work with 10 clients at a time.

My wife is a bookkeeper and each client takes her 3-5 hours per month, so her max capacity averages about 20 clients.

It would be dishonest to post, ”50% off if you schedule a call in the next 72 hours.”

The 50% off would kill my profit margin because I have a limited supply of time. And the 72 hours is completely arbitrary...

A more genuine way to use scarcity would be:

“I only work with 10 clients to make sure you have the access you need to feel like I’m in your corner!

Right now, I have 7 clients and openings for 3 more hard working, honest, ethical business owners to join my team. - Book a call today”

Here’s an exercise you can do to find yours:

How many hours per day do you want to work?

Daily work hours =

How many days per week do you want to work?

Day per week =

Hours per day x days per week

(ex. 6 hours x 5 days = 30 hours per week)

Minus 5 hours for sales and marketing

(ex. 30 hrs per week - 5 hours of sales/marketing = 25)

Multiply by 60%

(ex. 25 hours x 60% = 15 hours)

Now, determine how many hours per week you’ll need to work on a particular client. If it’s project work, it might be 1 client spread over two weeks.

If it’s ongoing monthly work, like bookkeeping, it could be 1 hour per week per client.

Once you have your total supply (aka total number of clients you can serve) TELL THE WORLD.

>>You can also use this exercise to figure out how much to charge!<<

We’ll cover that in another issue of the Profit Hacking weekly newsletter.

Thanks for reading the 19th issue of the Profit Hacking newsletter. Past issues will be located on the blog section of profitandgrow.com.

If you need help scaling your fractional CFO firm, adding advisory to your CPA practice, or are an entrepreneur interested in maximizing profit, minimizing taxes, understanding your cash flow, and making the best spending decisions, connect with me on LinkedIn https://www.linkedin.com/in/danielt6/

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By: Daniel Talbott