5 Ways to Grow ANY Business
By Lee Gray, ActionCOACH Business Coaching
Many businesses start with a great idea and lots of energy! However, a clear plan for the business is critical as well as regular activity doing the right things. One reason 80 percent of all new businesses fail (in the first 5 years), is due to lack of clarity and not working on the RIGHT things to grow AND sustain the business.
The 5 ways to grow any business include:
Leads,
Conversion Rate,
Number of Transactions,
Average Dollar Sale and
Profit Margin.
Leads are one of the 5 ways because without them we have no new customers – no matter what business you are in, you must always be adding new customers. The important point about leads is you must know how many you have. Too many businesses think they have more “leads” than they actually have or are investing in marketing they think generates leads but without tracking usually the number is overestimated.
Conversion Rate is another overestimated number. Find out what the average conversion rate is in your industry. Measure your own conversion rate and work on improving. The number one strategy for improving the conversion rate is to “ask for the sale”.
Number of Transactions is a relatively simple way to improve revenue and profit. You are already selling to your customer; how can you get them to buy from you more often? One strategy is to add a high value low cost item to the order (think, “would you like fries with that?”).
Average Dollar Sale; when was the last time you raised your prices? Even if your industry is price sensitive, a small percentage increase can go a long way toward a bottom line. If you are adding value to your product or service generally a price increase will go unnoticed.
Profit Margin is a number business owners should know and LOVE! Every owner should know their profit margin percentage. A strategy for increasing profit margin is to eliminate services you are paying for but are not using (a subscription or membership you no longer use). Most businesses can improve profit margins by looking at expenses and eliminating non-essential expenses.
A 10 percent increase in all areas of the 5 Ways results in a 61% increase in bottom line profit.
