Speaker | Adviser | Business Leader
When it comes to growing your sales (and profit more importantly) one of the best and most often overlooked strategies is to work on conversion rate. Conversion rate is simply the ratio of customers that buy versus those that enquire. Any gain in conversion goes directly to the bottom line. i.e grow your conversion by 15% and your profit goes up by 15%. Well pretty much ...
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If you are a small business particularly just starting out, it is all about revenue. Your accountant will tell you (very wisely) to focus on profit and I’d agree. However when you are trying to grow and get some mass, revenue can be just as important. I’m not saying you should do business for a loss or just for the sake of getting revenue, but I am saying that growing your customer base and getting cash flow going is key.
Of course it also depends what the vision of your business is. If you plan to stay small then the importance of profit goes up. If you want to have a team and enjoy some leverage then the focus of your efforts should be on growth and acquiring revenue.
I make this point because I see many small business owners getting caught up in the day-to-day operations and not spending enough time and effort on sales and marketing.
Think of it this way, if you had enough revenue to hire people to do your operations, then you could spend your time in other areas. And this is the catch 22 for small business. How do you spend time on revenue generation when you also need to spend time on operations? This is not a simple answer and will depend greatly on the business and the owner’s skillsets. The short answer is to get the low skill activities off your plate and free up at least 30% of your time to invest in sales and marketing. Even if you take a short term hit in profits due to the extra expense of an admin person, the time gained will quickly generate far larger profits.
If you are a small business particularly just starting out, it is all about revenue. Your accountant will tell you (very wisely) to focus on profit and I’d agree. However when you are trying to grow and get some mass, revenue can be just as important. I’m not saying you should do business for a loss or just for the sake of getting revenue, but I am saying that growing your customer base and getting cash flow going is key.
Of course it also depends what the vision of your business is. If you plan to stay small then the importance of profit goes up. If you want to have a team and enjoy some leverage then the focus of your efforts should be on growth and acquiring revenue.
I make this point because I see many small business owners getting caught up in the day-to-day operations and not spending enough time and effort on sales and marketing.
Think of it this way, if you had enough revenue to hire people to do your operations, then you could spend your time in other areas. And this is the catch 22 for small business. How do you spend time on revenue generation when you also need to spend time on operations? This is not a simple answer and will depend greatly on the business and the owner’s skillsets. The short answer is to get the low skill activities off your plate and free up at least 30% of your time to invest in sales and marketing. Even if you take a short term hit in profits due to the extra expense of an admin person, the time gained will quickly generate far larger profits.
We hear so much about healthy eating and good food diet ... how about our other diets? Like Mental and Spiritual. These are vital human systems that also need feeding. The problem is, most of the time we feed them by default. I.e. they just get whatever life throws at them.
I say be as intentional with your Mental and Spiritual Diets as you are with your Physical Diet. Here's my shortlist of favourites for my Mental Diet. I'd love to hear yours.
And my Spiritual Diet consists of:
What else do you do here?