I have, and continue to learn so much from Brian Tracy. Back in 2000-2005 I was using his closing techniques with HUGE success. Now I am digging into his New Psychology of Achievement which is as relevant today as ever, in terms of helping people succeed by getting their mindset in order.
About Brian Tracy — Brian is recognized as the top sales training and personal success authority in the world today. He has authored more than 60 books and has produced more than 500 audio and video learning programs on sales, management, business success and personal development, including worldwide bestseller The Psychology of Achievement. Brian's goal is to help you achieve your personal and business goals faster and easier than you ever imagined.
According to Brian Tracy, a general rule in your financial success in business is that you cannot increase profits directly, only indirectly. You cannot just say that you are going to increase profits of your business without some specific strategy.
For most of us, the only thing that we can do to increase profits is to improve the variables that ultimately determine our level of profitability. According to Brian Tracy when we improve these 10 variables about our business we will increase profits and affect our bottom line.
1) LEAD GENERATION
How we attract interested prospects to our business. If five out of ten prospects who come into our place of business end up buying from us and we can increase the number of people coming in from ten to 15, we can make more money and increase profits by 50 percent.
2) LEAD CONVERSION
How we convert leads into paying customers. It’s the measure of the effectiveness of our sales efforts. If we can increase our conversion rate from one out of ten to two out of ten, we can double our sales and increase profits.
Stepping up our ability to sell and convert interested prospects into paying customers is one of the most important things we can do. There is no replacement for ongoing sales training, both for ourselves and for every single person who speaks to our customers, either live or on the phone.
Consider every key result in our sales process and seek ways to improve a little bit in each area. A small improvement in each key area can lead to an enormous improvement in overall sales results.
3) NUMBER OF TRANSACTIONS
The number of individual sales that we make to each customer that we acquire. By increasing the frequency of purchase by ten percent, we increase our sales and increase profits by the same percentage. At FrankCrum Inc., I have discovered that a simple PEO prospect, after becoming a client and member of the PEO, may also be served by our carrier and agency through General Liability, Auto Insurance, Employee Health Benefits – heck, we can even provide someone with “pet-insurance” if they have a need. Additionally, we can bring them staffing options which may arise, once FrankCrum helps things start changing and growing at their company.
4) SIZE OF TRANSACTION
The size of the sale and the profit that we earn from each transaction. We should be continually looking for ways to up-sell each customer so that he or she meets more of their needs through our products and services.
5) PROFIT MARGIN PER SALE
Profit margin is the gross profit that we make from the sale of each product or service. By continually seeking ways to raise the price or to lower the cost of the product or service without decreasing the quality, we can increase profits per sale.
Every dollar we raise a price, if we hold costs constant, flows straight to the bottom line as profit. Every dollar we reduce expenses, if we hold sales and revenues constant, also goes straight to the bottom line as net profit.
6) COST OF CUSTOMER ACQUISITION
The amount that we have to pay to acquire each paying customer. We should be continually seeking creative ways to improve our advertising and promotion so that it costs us less to buy each customer. This can impact and increase profits of our business dramatically.
7) INCREASING CUSTOMER REFERRALS
The customers who comes to us as the result of referrals from our satisfied customers. Developing one or more proven referral systems for our business can have an inordinate impact on our sales and our business will make more money.
8) ELIMINATE COSTLY SERVICES AND ACTIVITIES
Many companies get into a routine or rhythm of offering expensive services to their customers that they could easily discontinue with no loss of customer satisfaction.
Look at the little services that we offer to our customers. Is there anything that we could reduce or discontinue altogether?
9) REDUCE BREAK-EVEN POINT
This is the number of items that we must sell each month to break-even or start making a profit.
We use this break-even point to evaluate the potential effectiveness of any advertising or any other expense that we incur to increase sales. Every expense to increase profits must be seen as an investment with an expected rate of return that is greater than the cost.
10) RAISE PRICES
In many situations, we can raise our prices by 5 or 10 percent without experiencing any market resistance. Because our products and services are of superior quality and our people are friendly and helpful, a small increase in our overall prices will not drive our customers away.
TAKE ACTION!
I hope you enjoyed these Top 10 Ways to Increase Profits by Brian Tracy. When we practice continuous improvement in all of these areas in your business we will make more money, increase profit in our business and help contribute to our future financial success!
James Chamberlain is a sales and business development professional who helps Tampa Bay businesses grow through dynamic strategic initiatives and campaigns and increase of new business revenue. James is responsible for building relationships with businesses throughout Florida and the US. Contact James at: 727.316.5997 james.chamberlain@consultant.com or http://www.twitter.com/JDC352
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