A businesswoman wanted to grow her business, so she scheduled an appointment with the greatest consultant in the world.
The next available appointment was three months later, so she waited patiently. On the correct day, she went downtown, found the tallest building in the business district and rode the elevator to the top floor. She was escorted into an immense office with a stunning view of the city.
Behind an impressive desk sat the greatest consultant in the world. As he motioned her to sit he said, “I will answer any two questions you have for $1,000.”
“$1,000? she replied. Isn’t that an awful lot of money?”
“Yes. It is,” he said. “What is your second question?”
Knowing that she had better make her last question count, she thought hard. After a few moments she asked, “How do I grow my business no matter what is happening with the rest of the economy?”
He smiled, “Now that is a very good question.”
He continued, “Despite all of the thousands of business books that have ever been written about sales, marketing, and company growth, there are only three key ways to grow your business. Everything else is a variation of these three ideas. Implement them successfully, and you will experience increases in your business.
The first way is to increase the value of your average sale.
By adding to the amount that each customer purchases, your sales levels will climb. There are a number of ways to do this. You can add new products or services that your customers need. You can bundle products or services together to increase the sale amount. Or, you can add to the value of your current service and get a higher price.
One thing to remember about this approach is that small increases in the value of your average sale can often make a large increase in your bottom line profits.”
The consultant noticed a strange look on the businesswoman’s face. “You look a little confused. Let me explain.”
“There are certain expenses that exist whenever you serve a customer. You have your rent, your phone bills, and the money you invested to get the customer in front of you in the first place. But, after they’ve arrived, it doesn’t cost you more to have them buy more. So, a higher percent of these additional dollars end up as bottom line profit.
I have seen sales increases of just ten to twenty percent double the bottom line profits of a business.”
The businesswoman smiled. Seeing his point was made, the consultant continued.
“The second way to grow your business is to increase the number of times a customer buys from you.
Every business has a frequency of purchase. A dentist hopes to see patients a couple of times a year. A restaurant hopes their regulars will come in at least a couple times a month. A hair stylist looks to see their male customers every four weeks.
By increasing the number of times you serve your customers, you will also increase the volume of your business.
There are a number of ways to increase purchase frequency. Some are as simple as always scheduling the next appointment at the end of your current appointment. Some are as elaborate as customer loyalty programs where purchasers earn points by buying more often.
Again, relatively small increases in how often a customer buys from you can have a dramatic affect on your bottom line. Think about the dentist example I just used. Imagine what would happen if every patient came in for a cleaning just one more time each year?”
Her eyes widened. “Wow” she said softly. The consultant went on.
“The third and final way to grow your business is to add more customers.
This takes time and can be expensive, but is it fundamental to growing a business. Realize that no matter how good you are, you will always lose some of your customers, clients, or patients. Some of them will move. Competitors will steal some of them. And eventually, all of them die.
That means that in order for you to survive, you must have a system for adding new customers, clients, or patients to your business.
If you don’t, not only will your business fail to grow, it will slowly head towards non-existence.
The best approach is to build a series of client collecting systems. These produce an ongoing stream of interested prospects that you can convert into customers.
Realize that the most successful companies in the world do one thing very well. They are very good at selling and getting new customers. If you put some “marketing machines” in place that create new customers for you, you’ll not only grow, you’ll assure that your business is around in the future.”
“How do I build a marketing machine? I’m not an advertising expert,” asked the businesswoman.
“That would be your third question,” said the consultant grinning. “But, I’ll answer it anyway.
It is almost impossible to be expert in all of the areas it takes for a business to succeed. That’s why you must find people who are experts and add them to your team. That lets you focus on the areas that are the best fit for you.
Find someone who really understands how to market a business and have them help you.”
The consultant and the businesswoman got up and shook hands. As she handed him a check, she knew that by following his advice she would make many times what she just paid in the few weeks ahead.
However, she still was a little annoyed about wasting that first question!
To your business success,
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Richard Wilson is the Founder/Chief Marketing Strategist for Sentium Strategic Communications which helps companies craft the right message for extraordinary results. Over the past 31 years, his clients have ranged from start-ups to major technology companies.
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