In the high-speed world of business, particularly for small to medium-sized enterprises navigating the track from $500,000 to $5 million in yearly revenue, the role of a business coach becomes as critical as a Formula One pit crew is to a racing team. Just as a race car must periodically pit to stay competitive, a business must also invest in strategic pauses—moments of reflection, recalibration, and reinvigoration facilitated by expert coaching. But what should this essential service cost, and how does it translate into tangible growth for your business?
The Pit Stop Analogy: Investing in Success
One of the questions we are constantly asked – even by other coaches is:
“Why do you only include two hours a month of coaching for your fee?”
It’s a valid question as our minds typically associate time and money as a linear relationship. More money for more time worked is how people get paid as employees. It’s how lawyers charge us, so understanding the difference will be key to how you perceive and value your coaching experience and relationship.
Here’s a great way to look at it:
Imagine your business as a Formula One car, racing at breakneck speeds. Your success on the track depends not only on your skill as a driver (or business owner) but also on the quality and efficiency of your pit crew—your business coaches. In this high-stakes environment, every second in the pit counts; the goal is to get you back in the race as quickly as possible, performing at your peak. The best pit crews do more than change tires and refuel the car; they make strategic adjustments based on the race’s dynamics, just as a skilled business coach does.
Clearly no one wins the racer with the pit crew that takes the longest to effect change on the car – the goal here is to have the most impact in the shortest amount of time and that is exactly the same as a great coach. If you are evaluating coaches and you are told you need to coach weekly – ask them why. Is this university or is it coaching. How does my value from coaching increase because we coach weekly. A good coach can answer these questions.
Understanding Coaching Costs
A standard benchmark within the coaching industry suggests that businesses should allocate approximately 3% of their gross revenue to coaching, training, and development. For a business pulling in around $1 million in annual revenue, this translates to a budget of $30,000 per year. At ActionEdge the majority of clients invest $2,750 per month toward coaching, so right along this ratio. This figure isn’t arbitrary; it reflects the level of investment needed to generate meaningful, impactful change within a business poised for growth.
The $2,750/month Investment
For this investment with our firm, a business owner can expect to receive two hours of focused coaching per month, coupled with the opportunity to participate in four full-day workshops each year. These workshops, designed for and attended by other business owners, foster a community of learning and mutual growth. Here, the pit crew analogy deepens—just as a racing team learns from the performance of others on the track, business owners can glean insights from the experiences and strategies of their peers, guided by the expertise of their coach.
More Than Just an Expense
Viewing business coaching solely as an expense is a narrow perspective that overlooks its true value. Unlike the cost associated with hiring an administrative assistant, investing in a business coach is about catalyzing growth, not merely maintaining operations. The primary goal is to elevate the business beyond its current plateau—be it at the $1 million mark or just shy of it—by enhancing the owner’s leadership, strategic thinking, and operational efficiency.
The rationale is straightforward: a business can only grow to the extent that its owner does. This growth encompasses not just technical skills or industry knowledge but a profound understanding of business processes, marketing acumen, and the agility to adapt sales strategies effectively. Many businesses, particularly those stuck around the $1 million revenue mark, struggle not because of a lack of effort but due to a lack of systematization, process documentation, and a coherent, tested marketing strategy. Great coaching programs are designed to address these issues and more, and you as a client should expect no less.
Conclusion: A Worthwhile Investment
Investing in business coaching is a commitment to not just incremental improvements but quantum leaps in performance and profitability. Like the most successful Formula One teams know, victory is not just about how fast you drive; it’s about how smart you pit. A business coach acts as your pit crew, offering the strategic insights and adjustments needed to win the race—not just in the short sprint but over the gruelling championship season.
The cost of coaching, therefore, is not merely an expense but an investment in the future success of your business and you as a business owner. By dedicating a portion of your revenue to coaching, you are effectively leveraging the expertise and experience of someone who can help navigate the complex, competitive world of business, ensuring your company not only stays in the race but leads the pack.