Posted by AndyM on September 29, 2009 under Business Growth | 
The simple question I help my clients tackle is “How do I grow my business?” That’s a pretty big question though, you have to admit. It’s a big question because making a REAL change can set you on a completely different path. Don’t fall into the trap of just working harder!
Any problem or challenge is SO much easier to deal with when you break it down into smaller pieces. This approach works well at any level:
- got a goal you want to reach in 5 years? set some incremental targets for each year along the way
- need to develop a presentation for an hour long talk within the next week? step 1, create an outline; step 2, assign time estimates to each section; step 3, pick a single section and create a more detailed outline…
You get the idea. Whether it’s as simple as deciding how you’re going to get your work done AND run the errands that have been hanging over your head or as complex as creating a financial plan for your future, you will benefit by breaking your challenge down into smaller steps first.
So back to the question — How do I grow my business? What do you think our first step is? You guessed it, we break it down into smaller pieces. Remarkably, it comes down to just four steps:
- Establish a Vision: you wouldn’t leave your house or office to attend a meeting if you didn’t first know where it will be — your destination. To have a vision for your business is to have a destination. How can you set a course for your company if you don’t know where you’d like to take it?
- Maximize the Current: Marketing books tell you that step 1 is to set your strategy (identify a need, define your target, determine your product or service, etc.), but if you are already in business, this would NOT be step 1! Maximize the profits from existing clients and new customers to get an immediate lift in your business.
- Set the Strategy: once you’ve increased the profit you get from existing relationships, learned more about your customers, and improved their level of satisfaction in the process, you’re in a better position to create an effective growth plan.
- Generate and Convert: with marketing systems in place that maximize the profits you generate from each new customer, it’s NOW time to improve how effective you and your team are at converting new prospects into customers and put multiple lead generation strategies to work.
So what do you do from here? Well, take step 1 and break it down into smaller pieces of course! Therefore, I will spend the next 4 weeks detailing each of the 4 steps. Come back, check it out, and make small changes NOW that will lead to HUGE LEAPS in your business!
Posted by AndyM on September 10, 2009 under Business Growth |
Recently I conducted a 90 minute workshop for some of the members of a local chamber of commerce. The topic was how to create (and “live”) an effective Marketing Plan. Before I even got rolling with the material though one of the attendees reacted with “Wow! an engineer who does Marketing?”
I had only gotten through my introduction, describing a bit of my background. Now some of you know that I have a degree in Mechanical Engineering from Cornell and that my FIRST job was as a manufacturing engineer in a plastics company. I soon moved into sales and management, but that initial role, and my academic engineering “discipline,” influence my Marketing perspective, and help me in my business to this day. So how does this unique “lens” that I use on the function of Marketing help my clients? Let’s look at the definition of “engineer” from the American Heritage® Dictionary:
verb: To plan, manage, and put through by skillful acts or contrivance; maneuver
I have always identified with the process aspect of engineering: make a plan, execute to the plan, refine, repeat. Marketing is a GREAT medium for an engineer to express his or her creativity. And the rewards are AWESOME. So how does an engineer think about improving the profits of a business? As “levers,” of course (mechanical engineering humor — did you get it?).
The Seven Levers of Profit Growth
- Generate more leads: this is a critical one, but it often gets TOO much attention. 10% improvement here with NO other changes to your business = 10% growth in profits. Are you with me?
- Convert a higher percentage of leads: do you follow up with each lead IMMEDIATELY and continue with positive communications through multiple rounds follow up, even when there is no response? 10% improvement here with NO other changes (no increase in leads, for example) = 10% growth in profits.
- Number of transactions: what are you doing to entice your customers to come back more often? Just a 10% improvement leads to…you guessed it = 10% growth in profits.
- Average transaction value: are you and your partners, sales people, order takers systematically (one of an engineer’s favorite words) recommending complementary products, indicating the price break available when more is purchased, and pointing out the bundle of products or services that the customer should review before making a decision? Could you improve a bit?
- Profit margin: as your business grows, you likely have more leverage with suppliers, may be buying in higher quantities, and may otherwise be able to realize the benefits of scale. Increase your profit margin by 10% — grow your overall profits by 10% too!
- Generate referrals from customers: so now you have more customers (from the above activities); what can you do to derive more benefit for your business from each customer than your competitors can? Nurture those relationships to generate referrals. Guess what — it’s a win-win. Provide over-the-top service, keep in touch with your customers regularly, and provide them the means and the incentive to refer you, and they will do it gladly.
- Extend customer buying lifetime: the number one reason why your customers will try one of your competitors? It’s not because they’re dissatisfied (not usually), price isn’t even the number one reason — the number one reason people try buying from someone else is that they don’t feel their primary provider cares all that much. Keep in touch, continually offer incentives for them stick with you, thank them for their business in creative ways, and you will keep them around MUCH longer.
So what do you get when you improve in each of the above aspects — flexing each “lever” just a bit? Massive profit growth. Your business may not be conducive to modifications of each variable, but make improvements of just 10 to 20% in a handful of areas and you’ll add 50%, 100% or more to your bottom line!
Want to learn how to make those levers move and put more profits in your pocket? Register for immediate FREE access to Lesson #1 of our online workshop series.
