The problems you are facing in your business will always be the result of something else causing it further upstream. Let's take a look at a familiar picture I come across often.

It was a bright summer's day in January and our friend Bob the builder made a new year's resolution to start his own business. He worked for XYZ Builders but knew if he worked for himself, he would get more money and be able to work when he wanted to - he could be his own boss. Bob knew how to build and was damn good at it, he could put up a house quicker than most, his work was top notch and customers were very happy.

A few months later Bob took the plunge and went out on his own. To get started he undercut other competitors in the market. There wasn't much profit in it, but it was work, and it felt good to be busy and on the tools. A couple of years went by and he had grown from a one man operation to a team of eight, but the market was tight so he found that to get jobs he often had to reduce the price to be competitive.

The days were long, so by the time Bob got home he was too tired to do the paperwork, like invoicing, paying the accounts, checking the bank accounts, etc. He just didn't enjoy this part of the job, so it was often left to the last minute or sometimes was just not done at all.

Although cash was a little tight and some bills were a couple of months behind, he had plenty of jobs and lots of money to collect - things would work themselves out - nothing to worry about, or so he thought.

Things were lean for a few months, but the newspapers were saying the economy would pick up soon, so he just had to hang in there a bit longer. Suppliers were getting a bit tougher with overdue amounts and told Bob he had to pay them up to date before he could get more supplies. He decided to chase a few outstanding invoices himself, to discover that some of his customers had gone belly up, resulting in $189,000 in bad debts - money he was never going to see again.

To make matters worse, his accountant showed him that although he had plenty of sales, there were a few jobs he had lost money on and that he was looking at a loss for the year of $259,000 (that's without the bad debts he was scared to tell his accountant about). Now he was running out of money fast and needed a loan from the bank just to keep going. The bank said NO, as he had no security left. Bob's dream was starting to crumble in a pile of debt.

Bob was a great tradesman, but not so great at business. Let's look upstream and see some of the areas that first started to go wrong.

• Bob had not learned how to get better prices for his work. He did a better job than his competitors, but was not getting paid what he needed or what he was worth.
   
• Bob didn't know how to attract better customers who would pay top dollar and also pay him on time.
   
• Bob didn't know when he was making money or losing it. So each month he was not sure if he was ahead or behind. A dangerous place to be.
   
• Bod didn't understand margins or know if they were high enough. He was competing on price without knowing what he needed to charge to make a good profit. If your margins are too low, it is almost impossible to make money.
   
• Bob wasn't invoicing on time, so the money wasn't coming in on time either. (I have seen some businesses not bill jobs for 12 months - a crime against business.)
   
• No one was checking to make sure customers were paying on time and chasing them up. (You did the work, so you are entitled to get paid).
   
• Bob was not paying his suppliers on time. (Important because, as Bob found out, without the materials, you can't complete the job.)
   
• Bob probably didn't keep in contact with his bank manager, so the bank assumed the worst.

A few adjustments upstream can make all the difference.

Often businesses are looking that “one big thing” that will turn their business around or take it to the next level.  But it is those small increases repeated consistently every day that will make the biggest difference.

Let’s have a look at how the small numbers can add up.

I have listed below nine key parts to your sales process:  

Let’s set the objective of improving each of these by a very small increase of just 5% and see what happens:

1)       + 5% increase in leads   

A lead = identifying and approaching a person or business that has an interest in your product or service and the authority to purchase it. 

There are literally tons of ways to get 5% more leads and sales appointments, including advertising, signage, directly targeting a specific group with letters or emails, website, cold calling, etc. Just improving existing strategies or adding new sources will quickly improve your numbers.

2)       + 5% increase in conversions

Improve your conversion of inquiries to sales. The best way to do this is to improve the abilities of you and your sales staff. This could mean completing sales courses, gaining a better understanding of the features and benefits of your products/services, and better understanding your best customers and why they use you (ask them - you will be surprised what some of them say).

Becoming armed with more skills and a better understanding of your customers will definitely increase your conversions by at least 5%.

3)       + 5%  increase in average dollar sale                        
            
Obviously, if you can sell more on average to each customer, sales increase automatically. It may be as simple as offering them something extra. Make sure you always bring out the dessert menu!

You can do much in this area to bump up your sales - including increasing prices, up selling, and cross selling, just to name a few.

4)       + 5% increase in customer visits

Getting customers to buy more often is a very easy way to increase business. Of course it depends on what you are selling as to how many more times you can get your customer to buy.

If on average a customer buys from you 4 times per year – think of ways to get that average up to 4.2 times per year.

Even if you are selling big ticket items, think long term. If you are selling houses, remember that on average a home owner will buy 5-6 in their lifetime. Stay in touch, and your customer will think of you next time they want to buy.

5)       + 5% increase in products and services sold        

Options to get your 5% increase here are endless and include selling more items, larger quantities, adding other products or services to your range, targeting products not previously brought by that customer, and many others.

6)       + 5% increase in client retention

Client retention is about keeping your customers for longer. It does not matter what business you are in, there are plenty of competition doing everything they can to take your customers. In some cases they will be successful. 

To stop customer attrition, you might consider putting in place a loyalty program for your business. “Buy 10 coffees, get the 11th free” may seem dull but it works. Yet very few businesses actually do use this simple way to keep customers coming back.

7)       + 5% increase in follow up

Follow up old quotes and customers on your database that didn’t buy. Engage their interest - get your prospect to look further into your product or service. Think of innovative ways to stay in touch with them such as sending further information, free samples, newsletters, or a phone call to talk with your prospect about their needs.

Remember not everyone is ready to buy now, some will just be researching or it is not quite the right time. Some will buy later on – so make sure they buy from you by continuing to remind them that you are the best choice.

8)       + 5% increase in referrals            

Most businesses rely on word of mouth as a way to attain a portion of new customers. However word of mouth is quite unreliable and hard to predict as the circumstances often need to be just right for a referral to result. 

You can get more referrals by actively encouraging your customers to give referrals with the right system and incentives.

9)       + 5% increase in reactivation of previous customers

Every company has a list of customers who previously brought but for whatever reason are no longer buying from you. Re-approaching these old customers can be a goldmine for new business.

So we have covered nine areas of your sales process and looked at simple ways of optimising each area by 5%.

So let’s have a look at the numbers:

Sales                                                   $1,000,000

9 improvements x 5% each          45%                       

Increase in sales                             $450,000

Total sales $1,450,000 – a whopping 45% more sales.

So you see, small numbers can make a big difference to your sales. With a little focus and consistency in each of these areas you can make a massive difference to your sales and profits.

Time is limited and it is important to do each one well to get the best results. Pick one strategy per month to work on. In nine months you will have a minimum of 45% more sales than you had before. Not bad for a few small changes.

By the way, you will find that at least one of these strategies will give a lot more than 5% increase. It is quite possible that one of these could give you 30%, 40% or even 50% increase. So go for it now and get your business flying.

One more thing, to get the real benefit from these strategies it is important to make each one into a system that everyone follows. Make sure you clue your staff in and make it a team effort!

This process is simple – but most do not follow through. A year later they are no further ahead. Don’t be one of those - start now and take some action – there is no better time than now.

Always remember, business is a lot like fishing. The more lines you have in the water, the more fish you are going to catch.

Suppose you have ten fishing lines in ten different locations – chances are you will catch more fish. All the bases are covered. And of course when you find where the best fish are biting, you will make sure you put most of your efforts there.

So how many fishing lines do you have right now for your business?... website, advertising, referrals, customer loyalty program, signage, effective quote conversion, in store promotions, social media...

When marketing your business, you should have a minimum of ten different marketing strategies for increasing customers and sales in your business. Also make sure you check those lines for bites, and record where the fish are being caught. The biggest mistake many businesses make is that they don’t measure the results!

That promotion from six months ago - can you remember how successful it was; would you use it again? The only way you can decide that is by looking at the results. (If you are unsure how to measure this, email me for a free form and instructions.) -

How many customers came from it?

What was the cost of the promotion?

How much profit did you make?

All very important questions.

Here are a few ideas to get you started:

·         Advertising

Done well this should produce a steady stream of customers to your business – however make sure you are getting back more than you are spending. If not, then you need to change your approach until you do.

·         Centres of Influence

There will be key people or companies you are associated with that could be a great source of business and referrals for you. This could be a key customer who is already giving you referrals or even a supplier. Talk to them about how you could systemise referring each other customers.

·         Joint Ventures

This is a company who has similar customers to you but does not directly compete with you. A hair salon and a cafe both have customers who would use both services, so you would make an arrangement where you refer business to each other with existing customers. Done well this is a very cost effective way of getting a lot of customers quickly to your business.

·         Networking

Attend networking events in your local area such as events held by your local Chamber of Commerce, BNZ who hold regular networking events every month for anyone in business, BNI, or trade shows. These will all have businesses that could be potential buyers for your products and services.

·         Add-On Sales

There are always opportunities to increase sales to your existing customers. If you are selling men’s clothing, the perfect time to sell a tie to this customer is when they are buying a suit. This needs to be a focus for all staff and a deliberate strategy to increase sale value.

·         Making the Sale (Conversions)

How good are you at converting walk-ins, enquiries or quotes? A case study I often use shows how a driveway company originally getting 1 customer for every 10 enquiries, is now getting 5 new customers from every 10 enquiries, just by improving their quotation process.

·         After Sale and Repeat Sales

This is about getting your customers back more often. If a customer visits your business 3 times a year, by increasing their visits to 4 times per year, assuming they buy the same value as before, will increase business by 33%.

·         Referrals

This is encouraging your existing customers to refer others to your business. You might give some discount or reward to your existing customers for referring you more business.

·         Website

Is your website bringing customers and enquiries to your business? A good website will be bringing paying customers to you in the form of either direct sales or enquiries you can then convert to sales. Check to see how much business you are getting from your website - how many visits, and how many enquiries or sales. If conversion is poor, then you need to change your website and then increase the number of visitors to your site.

·         Database

Most businesses spend a lot of time looking for new customers, and ignore customers they have already dealt with. Did you know that if you send your previous customers an offer, they are six times more likely to buy than someone who is a stranger to your products or services.

A database is simply a list of your customers and leads. It does not need to be complicated, and can be entered on a simple Excel spreadsheet if you do not have database software. This one is essential and every company without exception should have a database and be regularly contacting customers/potential customers with offers and information they will find useful.

By just working on one of these strategies every month, in 10 months you will have 10 streams of customers – what would that do for your business?!

Also be aware that not everything you try will always work first time, in fact if you are new to this, a lot of things you try will notwork. Keep at it because once you find the best fishing spot your bucket will be very full; it just takes time.

The fast track of course, is to get an expert fisherman who knows the tides, best locations, weather patterns, and the right bait for different fish. Even then he still needs to adjust to changing conditions – however compared to the inexperienced fisherman, odds are he will find more fish more quickly day in and day out.