Spring Training for Your Business
Now is the perfect time to train (and clean) for the long-term health of your business.
Las Vegas, NV, --(PR.com)-- As players prepare for the upcoming Major League Baseball season, now is the perfect time for business owners to jump into their own version of "spring training" – and "spring cleaning" – for the long-term success of their companies.
"The start of spring is a prime time to set changes in motion for any company," ActionCOACH Director of Marketing Nathan Smith said.
"The key is to focus on those things which will most likely affect profit – because that is the most important factor for the survivability of a company over time."
So what are the key factors a typical ActionCOACH Business Coach would focus on in helping a business owner get more "fiscally fit"?
Smith targeted these specific areas: Money: A good understanding of the numbers of the business, including break-even points, profit margins, conversion rates and number of prospective sales leads.
"We've found less than 10% of all business owners know what their break-even point for the business is, and less than 7% know what their daily break-even point is," he said. "Just imagine if you were part of that 7% who knew exactly how much you needed to sell every day in your business before you started to see a profit. That type of knowledge is real power in the hands of an owner.
Marketing: A sound marketing plan and comprehensive marketing campaign – that actually produces results.
"We've all heard the old adage that half of all advertising dollars are wasted, but it doesn't need to be that way," Smith said. "Campaign testing is key to finding a campaign which will work for your business."
What's the best way to test for a small company with a limited budget? Allocate 10% of the total budget to a test campaign. That way, a limited number of dollars will be at risk to test the viability of the planned campaign.
Customers: Current customers in today's economy – and any economy – are your most important asset. Do you have a database in place of your current customers? Have you gone to your current customers with special offers, added value products or new services?
"It is estimated it costs anywhere between six to eight times more to get a new customer than to sell to a current customer," Smith said. "So focusing on your current customer base is one of the most important things you can do." Smith adds that your customer base can also offer you a chance to do some "spring cleaning" for your business.
"One of the best things you can do is to segment your customers into 'A,' 'B,' 'C,' and 'D' level customers," he said. "Put all your efforts and focus on your 'A' and 'B' customers, and let go of your 'C' and 'D' level customers, and you'll see immediate results in the health of your company."
Why? "Not only will your profit margins be higher with your top customers, they are more likely to turn into 'raving fans' of your business, which helps with 'word of mouth' referrals," Smith said. "Your lower level customers, meanwhile, take up more of your resources relative to the revenues they give you – which produces lower overall profitability."
Finally, there is one strategy every business owner can use immediately to help boost profits.
"Raise your prices," Smith said. "Your best customers won't notice and you'll add more profit to your bottom-line. In turn, your worst customers will more than likely take their business elsewhere. Either way, your business will be better off."
ActionCOACH is the world's number one business coaching and executive coaching firm, with more than 1,000 offices in 26 countries.