Running a business is something of a paradox. Too frequently, we hear of businesses who have huge revenue figures, but are struggling to keep their heads above the water. In fact, it’s entirely possible (and often probable) for a business to go broke whilst in the process of rapid growth.
The reasons for this are mixed, but the solutions are usually very much the same. However, you will need a certified Business Coach to show you how it’s done… or you’ll need to become one yourself. We aim to help you do both.
Take Dan Bradbury, for instance. Dan is the UK’s highest paid business coach, and the owner of the APCTC. It’s his (very well paid) job to swoop in and save struggling businesses from their own profit margins. Every once in a while, he runs his acclaimed Business Coach Training course for us, which comes fully certified. it’s happening again this October (2016 – if you’d like to find out more, email our colleague Gabriella and tell her you’re interested).
To help us promote it, he has shared some of his business keystones at both a foundation and an advanced level. Next up, we have:
#2. The Low Hanging Fruit
Here are two important questions for you, and your clients:
- What is it that makes a service valuable to your clients?
- What is the easiest thing you can do – right now – to add massive value to your business?
This is the part where we make what you offer irresistible. Where we add so much value to your service that your prospective clients will want to book you before you even tell them what you cost. That’s the dream, right? Most people think that the best way to add value is by putting in a lot more work… but they’re wrong. And they’re paying for it! What really makes a difference is completely within your grasp.
Somewhere in between the answers to the questions above dangles what we will call “the lowest hanging fruit”. An absolute gem that will add huge value to your clients’ experience, without adding any extra strain on your existing service. This massively valuable addition is usually overlooked. It’s drilled into us from an early age: anything that comes easily isn’t worth having. Right? Well, that’s wrong. In fact, often the easiest option is also the most logical and practical, yet because it’s ‘easy’ it’s usually overlooked.
If you’ve been overlooking it, it’s likely you don’t know what it is. Luckily, Dan has identified the 6 things that both you and your clients can look at as your possible low hanging fruits.
In this order…
The question you need to be asking is: “what is the biggest risk to my business, right now?” there may be one major thing, or several small things. But the most crucial thing is to identify them all, no matter how unlikely or fantastical. Stranger things have (and in our experience will) happen.
Risks can come in many shapes and sizes. They could be relatively easy fixes like “not enough clients” or “too much work, not enough time”, or they could be a little more complex: “a direct competitor is poaching my clients” or “my employees aren’t trustworthy”.
Every problem has a solution. In fact, every problem has a magnitude of solutions. The more options you have, the more likely it is that problem will be solved. The tricky part is identifying the risks and dealing with them before they develop into problems. You just have to ask the right questions to get to the right issues to tackle. Once you know your risks, you have clarity.
Profit is always a concern. It doesn’t matter how high the revenue is, your clients will never have a wide enough profit margin. It’s also fair to assume that their whole reason for hiring you is to see a nice impact on the bottom line. Yes, helping them get new clients and bulk up their numbers in terms of new (or better) business does need addressing, but before you look at that you need to look at the thing that costs nothing to cut.
Expenses. The chances are your clients are not keeping a particularly tight grip on them, which means they can get out of hand very quickly. Before you look at anything else, before you even *think* about rolling up your sleeves and delving into the inner-workings of your clients’ businesses, you need to understand their financial situation. Then you can advise them on what can be moved around to help their bottom line, based on a purely financial level. The difference you can make will astound you.
Getting new business through the door is expensive and time consuming. Sometimes the easiest thing you can do to improve your clients’ bottom line is look at who is already under their rosta. A simple engagement campaign, or a few personal touches, can make all the difference. After all, loyalty is worth its weight in gold! If you can turn your clients’ existing clientele into raving fans, then they will stick around and keep using their service.
And hey, this works for you too. Raving fans = more profit all around.
AOV (Average Order Value)
This is a very simple concept that doesn’t always involve the obvious price hike. This will be different depending on the nature of your different clients’ businesses, but basically entails increasing the amount a customer will typically spend with your client. This can be done a number of ways, the most obvious being the addition of an ‘upsell’ to an exisiting product or service.
An upsell is another higher priced product or service connected to the original one, usually taking the form of a ‘premium’ or VIP level of the original service. Upsells are usually fairly easy to create and attach to what’s already on offer, and the costs can be absorbed by the price increase.
Dan says that of all of his services, between 10 and 20% of customers will always go for the upsell, no matter what it offers, or what the original service entails. So a higher tier is a pretty safe bet to increasing the AOV dramatically.
AOF (Average Order Frequency)
How many times has your clients’ customers bought from them? Once, most likely. Maybe twice. So many businesses focus on the new sale first and foremost, but that is actually the most expensive and resource heavy way of hiking up your revenue. Sure, it’s important. But you really should be focusing some of your time and energy on those who have already bought from you first.
The beauty of an existing customer is they have already been engaged. They have their own testimony. They already know what their experience is going to be. By targeting the old customers (perhaps with a cheeky offer or special treatment, or even a gift) you are appealing to their tendency to go with what they already know (i.e. the safe option!)
Sometimes your clients will need some fresh blood. That’s a given. But so many overlook the easiest way of getting it: referrals! If you have successfully tweaked all of the above, the chances are your client will now have an army of raving fans desperate to show their loyalty to them. And a recommendation from a raving fan is one of the most powerful methods of garnering new business there is, with an amazing conversion rate.
How do you go about getting referrals? It’s a simple as asking. If they love your client as much as they should, they will happily get their peers on board.
… that’s when you really start to see some growth!
If you’d like to find out more about our Business Coach Certification Training (running in October 2016) email our colleague Gabriella and tell her you’re interested.
Next week we will be tackling the third keystone: client conversion – a powerful (and simple) business development technique you can use on both yourself… and your clients.