Growth engines: Scaling sales overcomes the tyranny of project revenue cycles

 “My mum used to tell me success stories of my family. My cousins are a generation older than me, and most were reasonably successful. She would tell me how one did this, then another did that. I always had in my head that I wanted to be like them,” says Javid Ibrahim, founder and owner of Ideal Response Group.

Rather than emulating that success, Ibrahim looks on track to exceed it. His company has achieved significant growth – 35 per cent compound annual revenue increases over the past three years – as a disaster rehabilitation service. But Ibrahim recognises that the strategies that brought it here won’t be enough to reach its ambitious £100m revenue target in the next seven years.

He identifies the first hurdle as building a scalable strategy to reduce customer acquisition cost (CAC) and increase client lifetime value (LTV).

The back story

Ibrahim’s journey started long before he founded Ideal Response. He started out managing his cousin’s McDonald’s franchise, where he learned the importance of efficient systems and the unwavering cleanliness demanded by the brand.

Armed with this knowledge, he ventured into the cleaning business, securing small jobs that soon led to contracts with Pizza Hut and Sainsbury’s kitchens. As momentum built and cash flow improved, he invested in digital marketing campaigns across Google and Meta. Initially, these campaigns yielded promising results, with inquiries aligning with the company’s ability to service small cleaning projects.

His general cleaning service came about after a request to clean a theatre. Success in this task led Ibrahim to establish a best-practice approach to large cleaning projects, which brought him into the fire and flood damage rehabilitation world. This then led him to acquire his supplier and expand Ideal Response’s service capabilities.

Three years ago, Ibrahim hired a veteran in environmental and chemical disaster rehabilitation, solidifying Ideal Response as a comprehensive disaster recovery and rehabilitation service provider with a team of more than 60 people.

Where the business is today

Ibrahim is clear that the business now faces multiple challenges as it looks to grow. “It’s clear that what got us to where we are will not get us where we want to be,” he says.

Built from the momentum of his start, Ideal Response excelled at winning and servicing small, short-term projects. Growth necessitated investment but as his team and resource base grew, so did costs. Accelerating project velocity initially worked because digital marketing platforms were effective. But customer acquisition costs have since skyrocketed, increasing by an eyewatering 148 per cent in just 30 months.

Competing with man-in-a-van micro-enterprises on price and an increasing proportion of late payments have slowed the growth rate he set. But the biggest issue is that Ibrahim is so operationally involved in the day-to-day that he doesn’t have the time to think and plan strategically.

He recognises the need to improve margins by leveraging the company’s sophistication and project testimonials into preventative maintenance and long-term projects. Such projects will change the shape of the company’s revenue and offer more stability and predictability. Building a scalable marketing and sales engine to achieve this is Ideal Response’s next big move.

The near future

Fire, flood, chemical and environmental disasters look set to increase in frequency and scale given climate change and depreciated investments and maintenance across UK infrastructure, among other factors.

As insured costs rise, the demand for preventative and predictive maintenance on controllable factors that prevent or limit the impact of disasters will grow. For example, predicting a pump’s failure allows for preventive action that could avoid issues such as fire, flood, or chemical spill.

Ideal Response has identified laboratories, construction, facilities management and insurance as industries that would find their casework and testimonials appealing. The company also has the experience, resources and skills to create insight into how a traditional break-fix response no longer works and that getting ahead of inevitable disasters through preventative and predictive solutions yields far more sustainable outcomes.

The nature of these services paves the way for Ibrahim’s appetite to invest further in Ideal Response on the back of the predictable revenue and improved margins that is already earning.

Growth lessons

1. Your attitude leads you – If a company is not growing, it is dying. Whether due to inflation, a regressive economy, increased competition, or the limits of its capabilities, doesn’t matter, growth is essential to maintain the value you have earned in your business. A growth mindset will open up your thinking and offer insights into how to overcome growth-eroding factors. While there is a remedy for each, will you undertake the discomfort of executing them?
2. Manage your sales equations—SaaS business models heightened interest in customer acquisition costs and the lifetime value of a client. A business should aim for a minimum of a 3:1 LTV/CAC ratio but the increase in digital marketing costs has ramped CAC to levels where the ratio has fallen dramatically.
   
   Digital pavement pounding offers a sound business-to-business option. Use digital means to define and build customer segments, then build quality data on each segment, specifically understanding who the buying influences are and what messaging matters to them.
   
   Once done, build a campaign using email and eventing to reach the buying influencers, ensuring human-to-human conversation engagement. Showing up and throwing up the features, benefits and criteria of your service or product destroys relationships and burns leads. To establish trust, people need to feel understood before they care to understand.

Growth Engines showcases remarkable yet frequently under-recognised business owners who collectively form the basis of our economic engine and whose entrepreneurial fortitude creates a more inclusive and prosperous Britain. It shares their journey, highlighting hard-earned insights and lessons on overcoming challenges and driving business growth.

Its creator, Pavlo Phitidis, is a founder of Aurik, a business scale and growth execution platform for established business owners. He also speaks internationally and authored two books: Sweat, Scale Sell: Build Your Business into an Asset of Value and Reset, Rebuild, Reignite: Turning Crisis into Opportunity