By Robert Craven, MD at The Directors’ Centre
Half the business world is incredibly busy whilst the other half is just waiting for something magic to come along.
This checklist is aimed at businesses that are slowing down… feeling like they have got stuck… stuck staring into the headlights like the proverbial rabbit!
If you are a business that is incredibly busy (and profitable) at the moment then come back to this plan later.
This is a “size 12 wellies” article. Lots of sweeping generalisations and treading on some people’s sensitive toes. Here goes:
Take two hours with your best business partner, mentor or advisor and implement a plan similar to the following:-
1. Put up prices by, say, 10%
This creates more profit (per sale) and if you lose any customers it will be the price-sensitive, disloyal ones that probably cause you more hassle than they are worth. You will be able to afford to lose them because you will probably make more money from the price increase than you will lose in leaving customers. (More profit.)
2. Decrease direct costs by, say, 10%.
Go to all your suppliers and ask them for a better price… ask “Is that the best you can do?” and say nothing till they come up with a better price. This normally works. (More profit.)
3. Sack underperforming suppliers, customers and staff as appropriate.
Only once you have improved your business model (see above) so that you are making a decent profit per sale, should you consider increasing sales. (Less wasted time.)
4. Rethink the way you present your business
Customers are not that interested in ‘what you do’ but they are interested in what ‘what you do’ can do for them. Make a commitment to start talking about what people get as a result of buying from you — what’s left after the purchase. Focus on the benefits that they gain from using your product or service. This will improve your sales performance massively (oops I just did it then!). (More sales.)
5. Sort your proposition or offer
Why should people buy from you if you are the same as the competition? What makes you different from the rest? Be able to articulate the ‘why’ and ‘what’ of your business in a way that is truly effective. You should be able to do it in ten words or less. (More sales.)
6. Get more leads, say, 10%
Go networking, find out about Google Adwords, get up earlier, and talk to more people. (More sales.)
7. Get better at talking to people, asking for the business and closing the sale.
Going on a decent sales course will add 10% to each of these fundamental steps in the sales funnel. These 10% improvements will create 46% more customers (!!!). (More customers.)
8. Get customers to buy more, say, 3% (More sales)
9. Get customers to buy more often, say, 3% (More sales)
10. Stop them leaving
Run a customer survey right now — simply talking to all your existing and past customers will generate more business, I assure you. Most customers who leave do not leave because of rubbish products or service — most defectors are content but someone came along who wanted their business more than you appear to… (More customers.)
11. Collect money quicker, 10 days quicker. (More cash.)
12. Write cheques slower, 10 days slower
but do this within contractual terms. (More cash.)
13. While you are at it, decide on three things you can do right now…
and which cost nothing, that you can do to blow away your existing customers and make them talk about you. (More customer loyalty and free promotion.)
Don’t procrastinate please. Take some time out, make the tough decisions and get on with it. Take massive action now.
OK, so I lied about the ten things and really it is more like 14 if you include having the meeting where you make the decisions.
Like removing a sticking plaster from your skin you can make these decisions and take these actions slowly or quickly. Your choice.
However, every day you waste in the no man’s land of indecisiveness adds to the gap between you and those have already made the tough decisions.
Those that have done the tough thinking are seeing exponential change; every day in the new world builds on the changes made on the previous day. Every day you don’t make these decisions is a day nearer bankruptcy.
In reality, there may actually be a deeper, more subtle set of changes required of you.
It is one thing to recognise what needs to be done and it is great if you make the commitment to implementing the changes.
Stop reading, there’s work to be done. Now!