5 Ways to Diversify Your Small Business

Diversifying revenue streams for your small business can help you prepare for uncertain times. Rather than relying on a single source of income, a business with multiple streams is better positioned to weather cash shortages, economic downturns, or slow periods in client work. Here are five strategies to consider when thinking about diversifying your business.

How do I diversify my small business?

You can diversify your small business by exploring new audiences, industries, or geographic markets and expanding the services or products you offer. Building partnerships and updating your skills can also open new opportunities and revenue streams.

Here are five strategies to consider when thinking about diversifying your business.

1. Target a New Audience

Your target audience is the group of people who benefit most from your offerings. Over time, you’ve likely gotten a clear sense of who they are and how to reach them. To diversify, consider whether there’s a different audience that could also benefit from your services.

Start by examining your current clients. What do they have in common—age, location, interests, or communication preferences? Then think about other groups with similar traits or needs. You can also study the audience your competitors are reaching. How does it compare to yours? With these insights, you can identify a new or expanded group of potential clients to connect with.

Learn More: How to Identify Your Target Clients as an Independent Consultant

2. Consider Branching Out Into New Regions

If your business is thriving locally, it may also do well in a different region. Expanding geographically can help you reach new clients and diversify your revenue. One of the perks of working independently is that you have the flexibility to work anywhere—even across the country or internationally.

Before entering a new market, research carefully. Understand your target audience in that region, confirm there’s demand for your services, and create a plan for how to enter that market successfully.

3. Partner With Other Independent Professionals

Collaborating with other independent contractors can open up new opportunities for your business. Working with a partner allows you to reach clients you might not connect with on your own and take on larger projects. It can also expand your professional network, helping you build long-term relationships that support growth.

Combining your skills with another professional makes your services more attractive to larger clients. You can tackle projects that require a broader range of expertise or offer more comprehensive solutions. Over time, these partnerships can help both businesses grow while creating a stronger presence in the market.

Discover: Working Better Together: Tips on Building Team Relationships

4. Apply Your Services to a Different Industry

It’s easy to get comfortable in the industry where you’ve built expertise. To diversify, consider how your skills might transfer to other sectors.

Think about what your services offer at a basic level and explore other industries where they might be valuable. For example, if you design websites for nonprofit organizations, could you bring those skills to educational institutions? Or if you consult on legal issues for tech companies, could your expertise apply to finance or banking? It may take research and trial and error but finding an industry overlap can open an entirely new market.

5. Expand Your Skillset

Updating your skills can help you attract new clients and create fresh opportunities for diversification. Clients often value certifications or specialized expertise, so investing in professional development can pay off.

There are many ways to learn new skills. Earning a professional certification can be worthwhile if you’re ready to invest time and money. Online courses through universities, vendors, or training institutions can be flexible and cost-effective. Free resources like webinars, industry sites, and forums are also valuable. Finally, networking—online or at professional events—can expose you to new ideas, trends, and potential partnerships.

See: Level Up: Skill-Building Strategies for Today’s Independent Professionals

Where can I find more support for independent professionals?

If you’re looking for more support to grow your small business, explore MBO Partners’ blog for expert tips and strategies. You’ll find helpful advice and insights to help you take the next step on your independent journey.