Read time: 5 minutes.

Service-based online businesses have their charm. The prospect of working with diverse clients around the globe, solving their unique problems, and making decent income can be incredibly appealing. And indeed, on paper, it's a highly promising business model. However, the reality often comes with a few unexpected challenges.

Running a service-based business can be tough. Here are some of the obstacles you might encounter:

1. Proving Your Worth: Demonstrating your ability to deliver the results that your clients are aiming for can be a daunting task. It requires constant validation of your skills and capabilities.
2. Managing Client Expectations: Clients have their moods, business fluctuations, and their unique (ahem) ways of handling them. As a service provider, you often need to stand their moods and business ups and downs.
3. Navigating Blame: It can be frustrating when clients blame you for a lack of results and fail to give credit when their goals are achieved. (sounds familiar, my marketing agency owners clients?)
4. Explaining Your Role: Many clients don't fully understand that you are there to support them and that their success largely depends on their own efforts.
5. Handling High Maintenance Clients: Some clients can be overly demanding, expecting immediate attention at all times, as if they were your only client. One of the ways to handle this is charge them PITA tax (Pain In The A**)...but no money can give your sanity back.
6. Dealing with Refunds: It can be disheartening when clients ask for refunds, even when they haven't put in the necessary work to achieve their goals. You did everything you could, and yet they ask for a refund. 
7. Limited Scalability: Service-based businesses often trade time for money, which limits how much you can scale. There are only so many hours in a day to provide your service, making it harder to grow without adding more team members and that leads to building this monster of a company - staff, payroll, sick leaves, hiring people to manage people...ugh
8. High Pressure: With a service-based business, clients often expect immediate responses and quick turnarounds. This can lead to high-pressure situations and the potential for burnout if not managed effectively.

While it's possible to mitigate these issues and optimize your service-based business, my preference for years now has been to operate on the consulting and advisory side of things, rather than "delivering" the actual service - for example instead of running a marketing agency and delivering marketing services I consulted for companies on WHAT they should do in their marketing efforts. I then moved to consulting for other marketing agencies on how to run an agency INSTEAD of running the agency for them.

Running a consulting business has distinct advantages that make it both enjoyable and highly lucrative:

1. Positioning as an Advisor: As a consultant, you position yourself as an advisor, leaving the accountability for results on the client's side. This role distinction allows for a more balanced 😉 relationship.
2. Client Accountability: Both the success and failure lie with the client. If they don't execute what you recommend, they won't get the results. Don't get me wrong, you need to deliver on your promise to support them. But that doesn't mean it's "all on you."
3. Less Stress: Consulting tends to be less stressful since you're not ultimately responsible for the result. You consult, guide, and recommend, while the client executes.
4. Scalability: Consulting is inherently scalable since you're not doing the labor-intensive execution. You can take on more clients without significantly increasing your workload.
5. Flexibility: Consulting often provides more flexibility in terms of where and when you work. As long as you're meeting your clients' needs, you can generally work from anywhere and structure your schedule in a way that suits your lifestyle. 
6. Variety of Work: As a consultant, you have the opportunity to work with a wide range of clients and industries and leverage your various skills. This keeps your work exciting and allows you to continually learn and grow as a professional, and choose what you like instead of being stuck and delivering work you hate.
7. Building a Personal Brand: Through consulting, you're not just building a business; you're building a personal brand. You become known as an expert in your field, which can open up opportunities for speaking engagements, podcasts, partnerships etc.
8. Higher Earning Potential: Consultants often charge higher rates than those providing a service. This is because you're not just delivering a task; you're providing expert advice and strategic insights that can significantly impact a client's business.
9. More Control Over Projects: As a consultant, you often have more control over the projects you take on. You can choose to work with clients whose missions align with your values and focus on projects that you find most rewarding. You get to tweak the scope, length of the projects and salary in a way that suits you.
10. Opportunity for Passive Income: Consultants have a unique opportunity to create passive income streams. You can package your knowledge into online courses, books, or webinars that can be sold to a wider audience, generating income even when you're not actively working.
11. Lower Operating Costs: Consulting businesses often have lower operating costs compared to service-based businesses. Since you're selling your knowledge rather than a tangible product or time-consuming service, you may not need much beyond a laptop, internet connection, and your expertise to get started.

Consulting has its advantages, and it - obviously - comes with its own set of challenges. But - if done right - it will bring you the financial freedom and stressless life.