Strategies: Going virtual adds expertise

— -- Have you ever failed to land a prospective client because they thought your company was just too small? I certainly did when I was a sole proprietor. One prospect — a large science museum — told me that though I was the best person to help them with their strategic business plan, they didn't feel comfortable hiring me because I was a one-woman operation.

I learned that I needed a way to add size, depth and strength to my company without adding employees. One great way to do this is by forming a "virtual" company.

In a virtual company, you join with others — also often sole proprietors — to bring your individual strengths, expertise and capabilities together. This enables you to more successfully market to and serve clients, and land bigger jobs.

For instance, one consulting company I've used describes "Their Team" in the company brochure, listing an impressive group of people. Below the name of each "team member" is clearly printed the name of their individual companies. Nevertheless, by listing these experts together, they show clients they'll have a full range of top specialists at their disposal.

Creating a "virtual" company — or a marketing alliance — enables you to:

•Do joint marketing. It's less expensive — and more effective — to combine marketing lists and create combined marketing materials. You can also reach a larger pool of potential clients.

•Offer clients a broader range of services. Sure, you may believe that you can serve all of your clients' needs, but the client may not feel the same way. Many clients prefer to hire specialists rather than generalists. By offering clients a team of specialists, you're more likely to get — and keep — a client's business.

•Reduce clients' apprehension. Many clients are reluctant to hire one-person or very small companies. They're fearful that they could be stranded if something happens to the one key person.

•Present a more impressive image. Together with your alliance partners, you're going to have a longer list of former clients, a broader range of experience, awards and other references than you would have on your own.

And there's another benefit — if you choose your alliance partners well, you'll get the chance to work with people you respect, enjoy and can learn from. That's better than always going it alone.

One of the biggest barriers to putting together a virtual company is recognizing that you may have to give up some part of a client's business to someone else. Are you willing to get a small piece of a big pie rather than all of a very small pie — or no pie at all?

Let's say you're a graphic designer who specializes in designing websites. Right now, you also do some of the technical, back-end programming for your clients, but that's not really your specialty. So you're limited in the scope of technical functions you can include in your designs, and if a large client wants a lot of bells-and-whistles, you can't handle the job.

By coming together in a "virtual company" with a more skilled website programmer, and perhaps adding other Web-related companies — such as companies specializing in hosting, maintenance or search engine optimization — you're far more competitive when making proposals to prospective clients.

Many types of business owners can benefit by forming a virtual company with other small companies, offering their services in an integrated package. These alliances can range from the relatively formal — with a combined website and marketing materials — to the very casual, perhaps coming together just for one proposal to a client.

Remember, virtual companies are not legal entities. There are no rules — one member of the alliance can bill the client and then subcontract with the other members, or each individual member can bill separately. The key is to stay flexible so you can meet the client's needs.

When you're looking to put together a "virtual company," look for partners that fit your own style of communication and maintain the same level of quality. And, as always, only do business with those you trust and respect.

You can't be everything to all clients, and you can't do everything yourself. As the old saying goes, "The whole is greater than the sum of its parts."

Rhonda Abrams is author of Trade Show In A Day and president of The Planning Shop, publishers of books and other tools for business plans. Register for Rhonda's free business planning newsletter at www.PlanningShop.com. For an index of her columns, click here. Copyright Rhonda Abrams 2007.