Are you doing all you can to maximize your business? Maximizing your business simply means examining and implementing efficiencies and revenue-sales generators. Here are 12 concepts which may help your business.
First, be the convenienc leader. Recognize the definition of value has evolved to include more than quality and price. The driving forces are now convenience to purchase and accessibility. If you do not meet the needs of the market and provide your product or service in the fastest and most convenient way, you are going to finish last.
Second, seek as many “linkages” as you can. Seek to be on multiple websites, in multiple media and have multiple marketing and sales partners. The more you are present the greater your brand awareness and the more likely you are to receive the order.
Third, offer “bring them backs.” What are you doing to get more business on repeat purchases from existing customers? Studies have pointed out it costs five to seven times more to get a new customer versus attracting an existing customer to repurchase.
Fourth, we live in the age of “couponing.” Couponing can take on many different faces and related offers. In tough economic times couponing is at an all-time high. It has been pointed out that over 75 percent of consumers in many sectors of our economy use coupons. If you’re afraid it will hurt your image, disguise it by placing your offer into “invitations” or letter format. If you’re afraid it will dilute your profit margin, price your product or service to allow for a healthy discount. Today, that healthy discount translates to 30-60 percent off.
Fifth, review your pricing. Have you increased your price to keep pace with inflation? If not, you are losing your profit margin. Have you set your price high enough to allow for discounting? Remember, less than 10 percent of the market will pay full price. Discounting, volume purchase breaks and other incentives to purchase are now a way of doing business.
Sixth, make technology your best partner. Embrace the Web, automation and any other technology that is more efficient and meets the markets overwhelming desire for speed and convenience.
Seventh, seek economies of scale. Can you enter into co-op marketing agreements, promotions and sales blitzes? Can you join or form a purchasing consortium? Can you outsource any aspects of your business? Most all of these steps will result in a higher return on investment.
Eighth, can you increase your flow? Look for ways to expedite shipping, billing and redeploying your cash. Roll over your inventory more rapidly. Shorten the billing cycles. Seek larger volume purchases, etc.
Ninth, look for ways to refine or redefine your products or services. Seek to add and market higher volume, have higher profit margin items or services. Delete loss items or services as quickly as possible. De-emphasize lower margin products and services.
Tenth, expand your reach. Seek new markets, new partnerships and methods of delivery. Would adding distributors, reps or marketing dollars give you access to new markets and higher volume?
Eleventh, seek to reduce your overhead and administrative expenses. What can you really do without? What can you do more efficiently internally or externally? Can you add automation, contract out, lease versus purchase, etc.? Cutting cost is hard, but these efficiencies immediately improve your bottom line.
Twelfth, closely examine the use and allocation of time. What would happen if you were to open one hour earlier or one hour later? What would be the effect of reducing or increasing production or customer service hours? Concentrate on devising more time to grow your revenue and less time in meetings about operating problems.
2012 holds many challenges. The greatest of all may be your ability to recognize and respond to a changing business and market environment. An environment driven by technology, changing consumer demands and needs and more competition. To survive and prosper you too must change and respond rapidly.
Ronald A. Nykiel, dean of the College of Business at Husson University, is a member of the National Association of Corporate Directors, has authored a number of books on management and marketing, counseled the President’s Commission on Executive Interchange and chaired a governor’s revenue forecasting commission.