Business Growth Calculator: Small Changes Drive Huge Results
Have you ever noticed that sometimes very small changes or adjustments can make huge differences? We see this principle of small adjustments all the time in areas such as; navigation, mathematics, and in interest calculations. For example, if you saved $10 dollars per month for 30 years at 9% interest you would have over $18,000 dollars, or 5 times the original investment! However, a small 1% increase on your interest rate would yield 25% more on your investment. A small adjustment, but a big pay-off!
Let us consider how we can manage our businesses to achieve greater profitability. Often we put most of our focus on the revenue portion of our businesses to improve profitability. We spend time on cost cutting strategies and better production methods to increase output and therefore increase revenue. These actions make perfect business sense, however, sometimes we forget to also consider improvements in sales and marketing – which can deliver big benefits as well!
The following are some general marketing and sales questions we should consider:
- What if I increased the number of sales leads that I am generating each month?
- How can I improve my average sales close ratio?
- What if I increased the average number of sales each year, from my current customers?
- Can I increase my prices without losing business?
As an example of how small changes in marketing and sales can make a big difference, a simple 10% improvement in each of these areas can deliver a bottom-line profit increase of over 50%! Yes, small adjustments can deliver dramatic results!
Business Growth: Where To Focus For Success
There are a wide range of marketing tools and techniques that can be used to address these key marketing and sales areas. For example:
- Increased Sales Leads
How’s your website doing? How many leads is it generating for you? Are your keywords optimized to help you rank when people search for your product or services? Have you considered SEO (Search Engine Optimization) to help you be found? Once prospects find your website, have you implemented a strategy to convert those visitors into sales leads and nurture those leads to become customers? Website traffic is good, but lead conversion is what it’s really all about. Leads from your website can be critical to your success. Based upon your business model there may be many additional options to consider as well.
- Increased Sales Close Ratio
Do you know how many leads you receive and how many turn into sales? If not, you may not have the right measurement processes in place. If you know you close ratio, then if it is “low”, say 10% or 20%, then you may not have the very best sales approach. Things to consider are; your qualification process, the training of your sales staff, does your sales staff have the right tools, is your value proposition compelling, who is your target market and are you reaching them? Any and all of these areas can dramatically improve your close ratio.
- Treat Your Existing Customers Like Prospects
On average it takes 5 times as much effort to win a new customer compared to keeping an existing customer. It’s also important to remember that your number one customer is your competitions’ number one prospect. This is why it’s critical to continue treating your customers as though they are prospects. If a customer has bought from you in the past, what are you doing to encourage them to buy from you again? Have you considered promotions to your existing clients? Have you built a referral program to give them something for recommending your products or services? Have you captured the key contact information about your clients and are you providing them useful and helpful information that will keep them coming back to your website?
- Increasing Your Pricing
Have you taken the time to compare your prices to the market? What is your value add versus the competition? Why do your clients buy from you; your value, your price, your unique value in the market? Competitive pricing in the market and your pricing strategy are critical to success. If you are charging 10% less than the competition and delivering more value, then you are leaving 10% of your revenue on the table. When is the last time that you did a competitive study and considered the “pricing elasticity” factors of your sales prices? If not recently, then perhaps you are leaving money on the table.
Marketing Team Houston would be pleased to provide you with feedback on what we would recommend based upon your individual situation.
To help you determine where to focus your attention for the best results, Marketing Team Houston has created an interactive and very powerful tool, the Business Growth Calculator. It is simple to use and will help you decide which sales and marketing areas to focus on first in order to reach your business goals. The Business Growth Calculator will also help you compare how much you can invest in new marketing and sales efforts and still benefit by increased revenue and profitability.
Take the Business Growth Calculator for a test drive and see the dramatic impact that making a few small adjustments to your marketing and sales efforts can make!
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