Business Success And High Income
Aren’t Just About Getting New Clients
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Business Optimization | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Getting new clients is important – very important. But when you get right down to it, there are other, equally (if not more) important, and more cost effective ways to grow your business. Here are three considerations: • Increase the number of customers or clients you have.
Unfortunately, most business owners spend most of their time, money and effort in trying to attract new clients to their businesses. There’s no question that getting new leads (prospects) who are potential candidates for your products and services is important. It’s very important. But that’s not where the real money is to be made - especially when there is more competition in the marketplace today than there ever has been. You may face competitors who are “buying” market share by offering lower prices, and other companies who sell their products and services through the Internet and toll-free numbers. Now add in your marketing costs such as, running ads, sending out mailers and paying for telemarketers. Then figure in the time consumed in qualifying prospects (either in person, by telephone or mail), as well as the entire sales process, including the time involved, salaries, commissions and bonuses you pay your staff, your overhead, and all the other attendant expenses. When you total it all up it’s easy to see why it costs up to six times more to get a new customer or client than it does to sell to an existing one. In fact, most business owners don’t even get enough new customers from their ads or sales letters to break even, let alone make a profit on the products they sell from those ads or letters. The real money sapper - the single most expensive thing you can do in your business is to lose a customer, and the easiest person to sell to is an existing customer. With those facts in mind, look what would happen if you were to reduce the number of customers you lose every year, and at the same time double the number of referrals you get, and increase the dollar value of each sale by just 10 percent. |
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That's a whopping 132% increase! |
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I'm confident you'll agree that a $238,000 raise in one year isn't bad - especially without bringing any new staff or employees on board! Now I'm aware that the above figures may or may not apply to your particular business or the actual products or services you sell. But the point is, and what the illustration demonstrates, is that even if you don't add any new customers to your business, you can still grow your business by keeping in contact with, and taking care of your existing customers and creating additional value for them to do business with you. And you can do it so much more cost effectively than you could if you were attempting to create that $238,000 increase by going after raw new prospects. Even if you only did half as well as the illustration shows you've still netted a 162% increase in profits - that amounts to $111,375 extra in your pocket! But even if you only did half of that you'd still end up with $53,828 in extra income for the year! Recent research has uncovered a large gap between what customers want and what their suppliers actually provide. For businesses that identify this gap and effectively capitalize on closing it, the financial rewards are HUGE. This will provide entirely new and ongoing streams of profitable income to the business owners and enable them to attract investors, if desired, or position their business for a quick and profitable sale when the time is right. |
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