For the vast majority of business owners, the goal for the first few years is to achieve stability – predictable cashflow, a steady stream of customers and new business, and certainty around the future of the business. Once things have stabilised, some take a breather and rest on their laurels. Others look to take active steps towards building a business that is more efficient, more profitable, and ultimately more valuable when it comes time to sell up and retire (no matter how far off that might seem). But where do you start? Like many things, growing your business is easier to handle if you break it down into manageable pieces, so here are five key focus areas you can explore to grow your business.
building your leads
You don’t need us to tell you that business is nothing without customers. Whether you sell B2B (Business to Business) or B2C (Business to Consumer), growing your business requires a careful and considered strategy to generate leads. Media and messaging choices will change depending on the business, industry, and target market in question. For example, growing leads for a café could involve offering loyalty cards to customers, Instagram promotion, and physical signage around the premises. On the other hand, a strategy to promote a painting service could involve letterbox flyer drops, signage on the painting van, and a-frame signs on job sites.
Lead generation and marketing should always be undertaken in a strategic manner, finding your potential customers where they are more likely to be receptive to the content and delivery of your messaging and tailoring that communication to them.
improving lead conversion
The top of your business’ sales funnel is full of leads, so what now? Ideally, the majority of your leads are qualified (i.e. the likelihood is they will buy from you, or have a need/want for the products or services you provide), and your next step is to convert them into sales. What many businesses struggle with, however, is maintaining high conversion rates, irrespective of the number of leads coming in. While there are a number of things you can do to improve conversion, if you’re growing your business there are some big-ticket items that you might consider ticking off first.
Internally, having a process in place to measure lead quality and conversion is a good start, as is setting a realistic conversion target. Creating a flowchart of your sales process may be beneficial in allowing you to make improvements in how you convert leads. As far as customer-centric improvements are concerned, making the enquiry or purchase process as streamlined as possible is critical – multiple payment options, a website that is easy to use and up to date, and a clear indication of value. You could also build prospect questionnaires into your pipeline that give you more information about the needs of the customer and encourage purchasing behaviour before you even make direct contact with them.
improving customer transactions
Much like our point above on streamlining the enquiry or purchase process, effective and sustainable business growth includes an improvement in customer transactions. It stands to reason that customers are more likely to come back and even refer other customers if their experience with your business was enjoyable, hassle-free and gave them what they wanted. Leveraging technology is a big part of this, particularly when it comes to automating the transaction and follow-up process. You might consider implementing a booking system where clients or prospects can set a meeting directly in your calendar for a time that suits everyone involved, or set up an online payments portal as an alternative to paying in person. The fundamental factor in improving customer transactions is streamlining the way you do business with them – automation, simplification and increasing perceived value are all key to this.
increasing average sales value
Growing the average value of sales in your business can come from simply raising prices, up-selling customers on other products, and stocking only high-priced items. However, there are some more tactical ways to do this, some that may even prompt the most price-sensitive customers to increase their spending. You could allow payment terms and easy finance that reduce the initial outlay of cash (but you still recoup the full amount eventually), sell additional warranties/insurance with your products, or educate customers on the value of your products (what they will do for them) rather than just the price. Particularly in an environment where you’re selling B2C, your products are there to solve a problem or fulfill a need, so selling with a solutions-based approach may take price out of the equation for customers and prompt them to spend more than they otherwise might have.
profit margin maximisation
Similar to increasing sales value, an easy way to boost your margins is to raise prices and reduce overheads. Savvy business owners can maximise their profit margins with clever alternatives, such as reducing the amount of stock tied up in inventory, re-financing their loans, offshoring or outsourcing tasks that would cost less outside the business, or even reducing or eliminating the provision of discounts to customers. A combination of these strategies may also be beneficial. Different approaches work for different types of business, but there are a variety of ways you can maximise profit margins beyond simply raising prices and cutting overheads.
business growth – the bottom line
No matter which strategies you use to grow your business, the key to success is having a plan in place, developing metrics and reporting tools to track your progress, and having realistic targets to aim for. If you employ staff, you might also consider leveraging their knowledge and skills to better optimise the way your business sells its products or services.
At McKinley Plowman, our Business Improvement team has spent years helping clients take their business to new levels with our extensive experience, knowledge, and strategic planning capabilities. If you’re ready to grow your business and improve your quality of life as a business owner, don’t hesitate to get in touch with MP+ on (08) 9301 2200 or via our website.
You can find a more comprehensive list of business growth strategies, along with a range of other useful resources, on our Free Resources page at the McKinley Plowman website.