(ProfitPathfinder – teaches people how to increase their profit)
“When I worked with Action International nearly 20 years ago, I discovered there are only 5 ways to increase the profits in your business and these are just as relevant today as they were then.
Most business people are looking for more Customers, more Revenue, and more Profit.
But more customers is the result of increasing your Leads and the rate at which you convert them to Customers; makes sense.
More Revenue is having customers spend more with you more often; yep, still with you, and more profit is the result of better margins from your now increased revenue.
Sounds simple enough.
So to get more profit, you need to increase your leads and have a better conversion rate, increase your average transaction value and then have people buy more often, and then work on increasing your margins.
This can be represented by:
Leads x Conv% = Customers x Ave$sale x No.Sales = Revenue x Margins = Profit
But where to start?
Well my favourite strategies have always been fast, free, and biggest upside.
You cannot beat raising your prices by 10%. It is literally my favourite strategy for a real punch in the mouth.
Most customers won’t notice, because most people who buy from you do so for some reason other than price; you just probably don’t know what it is yet and this will start you on your journey. Increasing your prices also gets you working on…
Average $ Sale, and Margins at the same time; two for one if you like.
Another perennial favourite is get better at serving your A-grade customers; the ones who don’t complain about the price, pay on time, are great to deal with and come back for more.
Hopefully putting up your prices would have frightened off some of those price-sensitive super-demanding and unpleasant customers, sending them off to the competition (who will thank you for them – this has happened!), thereby freeing up more time to really focus on the A’s.
What do they want and how do they want it? are valuable problems to ponder, so why not take some time to ask them.
Customers buy from you because they value your Quality, Service, or Price. It is up to you to decide which one of these factors will be the one that you lead your market in.
You can ‘meet’ the market in two of these, but you must ‘beat’ the market in one or risk being just another ‘vanilla milkshake’ in a sea of ‘vanilla milkshakes’. If you choose price, you’d better be able to go up against the big players.
Personally, I would choose something you have more chance of ‘defining and defending’ – the double Ds if you will.
For example, what would the best service look like in your industry and how would you deliver it every time? …would be a good question to answer.
Getting better at sales also increases Conversion Rate and Average $ Sale at the same time. And providing products and services that carry great Margin allow you to translate increased Revenue into increased Profits.
Do keep an eye on your expenses but not to the point that this detracts from your newly minted ‘customer experience’. You need the right amount of help available so the right customers get access to the right products and services in the way in which they want to buy them.
There are a great many people out there who are highly invested in making that process look as complicated as possible so they can sell you a solution when it really what is required is a little common sense.”
Want to learn more, right now? Grab this course, it’s totally free, and get stuck in:
Mike Green – Profit Doctor