A general rule for business success is that profits cannot be increased directly; they can only be increased indirectly. You cannot simply declare that you will increase your business’s profits without a specific strategy in place.
The only way to increase profits is to optimize the variables that ultimately determine your profitability level. By optimizing these variables with the help of quality business coaching in Brisbane, you can increase profits and positively impact your bottom line.
1) Generate Leads
The process by which you attract prospective customers to your business. If five out of ten prospects that come into your business make a purchase and you can increase the number of people who come in from ten to fifteen, you can double your revenue and profits by 50%.
2) Conversion of Leads
Conversion is the process by which leads become paying customers. This is a metric used by all good business coaches in Brisbane and AMG Coaching swear by it to determine the efficacy of your sales efforts. If you can double your sales and profits by increasing your conversion rate from one to two out of ten, you can double your sales and profits.
One of the most critical things you can improve is to sell and convert interested prospects into paying customers. And there is no substitute for ongoing sales training, both for you and for everyone who interacts with customers, whether in person or over the phone.
Examine each critical result area in your sales process and look for opportunities to improve slightly in each. A small improvement in each critical area can result in a significant increase in overall sales results.
3) Number of Transactions
The total numbers of sales you make to each customer you acquire. By increasing purchase frequency by 10%, you can increase sales and profits by the same percentage.
4) Transaction Value
The volume of each sale and the profit earned from each. You should constantly be on the lookout for ways to upsell each customer to purchase more each time. There is also no harm in increasing your product pricing if the market dictates, any supplier or shipping costs should be reflected in the price to the end user.
5) Gross Profit Margin on Each Sale
Profit margin refers to the gross profit earned on each product or service sold. By constantly looking for ways to increase the price or decrease the cost of a product or service without sacrificing quality, you can increase your profit per sale.
Each dollar you increase a price by, assuming costs remain constant, flows directly to the bottom line as profit. Likewise, each dollar saved on expenses, assuming sales and revenues remain constant, goes directly to the bottom line as net profit.
6) Customer Acquisition Costs
The cost of acquiring a single paying customer. You should always be looking for innovative ways to improve your advertising and promotion to reduce each customer’s cost. This can have a significant impact on and increase the profits of your business.
7) Increasing the number of customer referrals
Customers who come to you because of recommendations from satisfied customers. Developing one or more proven referral systems for your business can significantly increase your sales and profits.
8) Discontinue Expensive Services and Activities
Numerous businesses develop a routine or rhythm of providing costly services to their customers that they could easily discontinue without sacrificing customer satisfaction.
At AMG Coaching, coaching and strategies are offered to business owners, executives, and entrepreneurs who are seeking advice on key growth strategies, proven systems, effective techniques, and resources that will keep their businesses thriving in varying economic conditions and help increase the rate of their success.