The second in a five-part series, in step 1 we looked at why it is critical to have a vision for your business and strategies to achieve them.
We held Strategy workshops with key personnel, conducted PEST & SWOT analysis‘ on both your business and your competition. We then followed on from this with workshops designed to build on your strengths & opportunities and protect you from your weaknesses & threats.
How did you fare?
At this stage you should have a clear vision of your objective and understand the strategies that need to be implemented in order to achieve it, the first one being Marketing.
So in Step 2 we will look at your Marketing Vision.
2. Marketing Your Vision:
Ok, so you and your team now have a clear objective – its time to tell the world. If as part of your strategy meetings and workshops you didn’t work on your USP (Unique Selling Proposition); it’s time to do it now.
What is it that differentiates your product or service from your competition?
What makes it unique, better?
Is your product cheaper, is it faster, is it lighter or smaller etc.
Whatever it is, make this your point of difference and make sure your target market is aware of it.
Next, do a stock-take of your marketing collateral.
Look at it with the eyes of a potential customer; would you be interested?
Does your marketing use the AIDA principles of Attract, Interest, Desire, Action?
Do you have a presence on Internet?
Is your webpage outdated or is it a live, up to date interactive experience?
Does it have information to attract, get prospects interested, stimulate desire and importantly a call to Action?
For example you could offer a free “how to guide” about your industry, product reviews or a tutorial, available by entering your email address. This contact then becomes a potential lead and with the right systems in place will be followed up, e.g. by the use of a squeeze page capturing the prospects contact details and entering them directly into the CRM as a lead!
Follow up is critical, how often do your sales team follow up on a lead or enquiry?
How do you know?
A great tool which is essential to you being able to let go, to walk away knowing that KPIs will be met, is to implement a CRM, ideally one that is internet based allowing you the owner to log-in from anywhere in the world (e.g. from the back of your yacht) and check sales activity, orders, profits etc.
One such product is Sales-force; after researching the CRM software available for a particular client of mine, I can say that it is perfectly suited to manufacturing/service oriented businesses & is affordable both in implementation and maintenance with no need for software updates and expensive SQL servers.
Whether you use a CRM or not it is imperative to measure every aspect of the sales process.
You should also seriously consider investing in a “mobile app” for smart phones which your customers could download onto the one thing they all have with them at all times, their phone! This would allow you to target customers by region, by demographics, by the type of product they buy and then send them details of specials etc. A great way to increase the frequency and average value of each customer. There are many developers of apps on internet who for a minimal fee will have your app up and running in no time.
Do you know that by focusing on the following five profit drivers and measuring the results regularly in each you can transform your business?
- Increase leads: create and send newsletters regularly to your existing database of customers & prospects, ask for referrals and testimonials, join industry associations and local business groups. Attend networking events.
- Increase conversion ratio: develop scripts and follow-up processes.
- Insist that your salespeople read this book: www.businessballs.com/freespecialresources/Consultative_Selling_ebook.pdf
- Increase the number of times a customer buys from you: Treat them as a VIP buyer, give them discounts, celebrate milestones with them, ask for feedback and act on it
- Increase the average sales value per customer: encourage your sales staff to up-sell, create a simple form that they tick off each of the options they have offered their customer
- Increase your Gross Profit: through the systemization and continuous improvement of processes discussed later in this guide it is more than certain that you can increase your current GP by 10%
For example you have 100 leads and a 20% conversion ratio, now let’s apply the 10% increase:
|Average Sales Value||$25,000||10%||$27,500|
|Average Customer Value||$125,000||Becomes||$151,250|
|Average Customer Value||$125,000||21%||$151,250|
|Gross Profit %||20%||10%||22%|
|Total Sales Increase||$2,500,000||46%||$3,660,250|
|Gross Profit % Increase||20%||10%||22%|
By focusing on each of these key areas and achieving 10% increases in each, we have increased profit from $500k to $805k!
Is this possible? Yes, I believe so, but even if you were to only achieve 5%, wouldn’t that still be worth the effort?
Remember also, that what gets measured gets results.
Focus on increasing the number of leads, the conversion ratio, the number of customers, their average sales value and the profit on each sale and you are guaranteed to get incredible results!
In Step 3 we will look at automating your business, systematizing it so that it can run without you. You can subscribe by clicking the button on the right and you will be notified when it is published.
In the meantime work on your marketing strategies, consider a revamp of your webpage if it is not dynamic, set up a profile for your company on social media networks.
In Step 4 we talk about the importance of your people but social media, blogs etc is a great example of how some of your employees most likely have hidden talent that could be very beneficial to your company while also increasing their esteem and self-confidence. Don’t be afraid to ask for assistance in areas that are foreign to you, your people will actually respect you more for it and will be more than happy to assist.
Until next time,
About the author of “5 Critical Steps to Making Your Business Investor Ready”:
With over 26 years in manufacturing and a good many of those in management roles I have successfully implemented the 5 critical steps several times. As a business growth consultant I help business owners become investor ready. It is also something I am very good at and enjoy doing.
What I offer is to work side-by-side with you and your senior management team to:
- Prioritize problems/issues to be resolved
- Agree on expected outcomes
- Agree that this is something I can resolve
- Agree on the value of these outcomes i.e. extrapolate the added value of the exercise to your company and what this is worth.
To put your mind at ease, if the work that needs to be undertaken is not within my expertise I will say so.
If I don’t honestly feel that I can help you get to that day with the potential buyer where you really do have a saleable (and valuable) asset then I will decline the contract.
Imagine again its 12 months or two years from now.
A potential buyer walks into your business and asks to see how things operate….
Will you be investor ready?
0425 781 752