10 Steps To Success in 2012 – Step 10: Plan
10 Steps To Success in 2012 - Step 10: Plan
Ultimately whatever the aspirations for your business, write them down in a business plan in line with what you want to achieve over the next 12 months. By documenting your S.M.A.R.T. objectives, you are able to share them with peers, staff, bank managers and/or advisors to the business and it enables you to track progress and make decisions more easily that are congruent with where you are heading.
Include specific actions with who is doing what, by when and the associated measure such that you can monitor how you are getting on with the plan. Time is one of the most valuable assets you have and it is limited to so many hours in a day, days a week, weeks in a year and, as you know, time flies (where does it go?).
With a dynamic business plan (i.e. one that doesn’t sit on the shelf gathering dust), how you prioritise this commodity is made clearer and you can make the best use of the time made available to you and be more effective with the actions you take.
(Download a free business plan template)
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10 Steps To Success in 2012 – Step 9: Outsource
10 Steps To Success in 2012 - Step 9: Outsource
As a business owner, you are not an expert in every single aspect of what it takes to run a successful business – no one is (not even Sir Richard Branson or Lord Alan Sugar!). So outsource those functions that you either don’t like doing or can’t do effectively. The obvious ones are the financial accounting requirements for a business, legal matters, HR/Personnel issues, Health & Safety.
But what about sales, marketing or operational needs for your business?
Employing staff is not always the answer or the best option for your business (as employees bring their own problems for business owners with them!) – there are advisors, consultants and experts that can provide solutions for whatever your business is looking for.
The benefits of outsourcing (versus staff) are that it is ‘turn-on-and-off-able‘ as and when demand changes and the relationship is one of supplier to customer, not manager to staff, so potentially the dynamic is better; or at least different.
By offloading such responsibilities from your shoulders, this takes the onus from you working ‘in’ the business, allowing you to work ‘on’ the business and take a more strategic view on the direction of where you want your business to be.
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10 Steps To Success in 2012 – Step 8: Cashflow
10 Steps To Success in 2012 - Step 8: Cashflow
Cash is the biggest killer of businesses – large and small. Lack of cash within a business (or extensive borrowing and the inability to repay it) cuts off the lifeblood within an organisation and ultimately will lead to its failure. Knowing what cash is coming in and out of your business and when is essential. Invoice regularly – there is no need to wait for the end of the month and chase invoices before they are due.
Doing this ensures there are no issues that would prevent payment, that you are on the payment run and to keep your bill in the mind of the debtor – sometimes it’s who shouts the loudest gets paid the soonest.
Manage relationships with creditors and negotiate better payment terms that benefit your business. Have a cashflow projection that looks forwards not backwards, so you can manage bills that will become due in the future; like VAT for example.
(Download a free cashflow template)
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10 Steps To Success in 2012 – Step 7: Profit
10 Steps To Success in 2012 - Step 7: Profit
No doubt you have heard the expression: “Turnover is vanity, profit is sanity“? There is no point, as a business owner, having a high turnover but only a few pounds profit – or worse still, a loss. Understand the break even point in your business and keep control of your costs; whether it is staff, raw materials, utilities, rates, etc.
Have regular management accounts generated (at least monthly) by your finance person that provide you with the key financial measures that are important to your business (including a cashflow forecast).
Knowing where you are in your business from a ‘bottom-line’ perspective enables you to make more informed decisions about the direction of your business.
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10 Steps To Success in 2012 – Step 6: Price
10 Steps To Success in 2012 - Step 6: Price
Do you understand the difference between price and value? If you are selling on price only, there is always the possibility that a competitor will undercut you. Buyers who purchase on price tend to be less loyal as a customer; next time they may also buy elsewhere because it’s cheaper.
If you can create value in what you are offering (combined with your competitive advantage relative to the need you are fulfilling) then customers will invest in what you have to offer and will buy more from you or come back for different products/services.
Creating value can take many guises – it could be a guarantee, or something extra for nothing e.g. a free carry case for a laptop, or something that is exclusive to your business, a special offer (not a price discount), etc – hopefully you get the idea?
Test your pricing, make sure you are not selling too cheaply – if you have the right value proposition, price will not necessarily come into it – take Mercedes-Benz/Rolls Royce (above) for example. You can often afford to put your prices up and not impact your bottom line profits.
Did you realise if your margin is 40%, a 10% price increase could sustain a 20% drop in sales volume without any impact on your profitability? The ‘double whammy‘ here is, that if you lose customers by putting the price up, you have just identified those customers that only buy on price (and you may not regret losing them!).
(More information on price increasing for other margins and percentages)
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10 Steps To Success in 2012 – Step 5: Measure
10 Steps To Success in 2012 - Step 5: Measure
Whatever your marketing efforts entail – you need to be measuring the results and tracking where you get the most leads being generated. You can do this in a number of ways. This is easier online as you can use specific website or email addresses that relate to a particular campaign.
Google Analytics is also a great, free tool to track visitor activity on your website. There are also tools for tracking traffic via email campaigns and social media interactions, as well as pay-per-click ads; most of them are free or low cost.
If you can’t measure it, you can’t manage it and know how effective a specific piece of marketing is.
For offline activity, telephone tracking numbers can be an effective, and relatively low cost way of knowing where business opportunities are coming from. A telephone tracking number is a ‘normal’ number (as opposed to 0845/0870/etc) that is published in your mailshot or advert, specific to that particular marketing channel; thereby providing you information on how many calls came through for a given project.
It is important to know your return on investment for any marketing that you do, to enable you decide what to do more of what works and less of what doesn’t work – this way you get more ‘bang for your buck‘!
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10 Steps To Success in 2012 – Step 4: Method
10 Steps To Success in 2012 - Step 4: Method
Great, so you’ve got your target market, your USP (Unique Selling Proposition) and a message that hits the spot – now your challenge is to get the message out there through a variety of marketing activities. In my mind, these be categorised into passive and active, then online and offline.
Passive marketing is an advert or a directory listing for example, where you are waiting for a prospect to take action to contact you i.e. you have no direct control or influence.
Active marketing is where you are engaging directly with your prospect – this might be through email marketing, telephone calls, direct mail, etc. In this case you have more ability to encourage a ‘call to action‘ that will lead to new custom. On the whole, being more ‘active’ is likely to yield better results for your business.
Your marketing should be ongoing and you should be implementing multiple channels to your identified market.
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10 Steps To Success in 2012 – Step 3: Message
10 Steps To Success in 2012 - Step 3: Message
Knowing your ideal customer and competitive advantage allows you to focus your message really clearly, bringing out the specific benefits that touch a nerve with your potential client compelling them to do business with you. Within the niche you have identified, you may also have sub-groups that you can address with a message very specific to them.
For example, if your niche is offering websites to businesses in the county where you live – the offering to a start up business and an established business would be different; as the needs of each would vary. Therefore the benefits would need to align with the specific requirement for each of those distinct types of prospect in the approach you take to acquire them as a client through the marketing message you use.
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10 Steps To Success in 2012 – Step 2: Competitive Advantage
10 Steps To Success in 2012 - Step 2: Competitive Advantage
Once you have established your target audience for what you have to offer, what makes you better than your competitors; what distinguishes your business from the competition and would have a prospect choose you as opposed to one of your rivals? What pain are you easing or need are you fulfilling and what are the benefits of doing business with you over an alternative supplier? You need to stand out from the crowd and not appear the same (or a commodity) to your potential customer base.
Imagine if you were a shop on the High Street and a competitor opened up next door, what would you do to encourage people to come into your shop and not theirs; or if you took the ‘header’ off your website and swapped it with the ‘header’ of your nearest competitor’s website, would there be any significant difference? Better still, if you can become the recognised expert or specialist in your line of business this will significantly enhance your position versus the competition.
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10 Steps To Success In 2012 – Step 1: Market
10 Steps To Success in 2012 - Step 1: Market
Identify who your ideal customer is. Rather than trying to be all things to all people, be specific about who you would want as a client. Look at who your best customers are now (and your worst) and aim to get more of the best (and much less of the worst!).
Your niche could be defined by:
- turnover
- number of staff
- geography
- industry sector
- sex, age or ethnicity
- hobby/interest
- position within a company
- etc
…or more than likely a combination of these factors.
How many new customers do you actually need? It is easier to target a prospect list with a 1000 names on it versus tens or hundreds of thousands. The more specific you are, the better you can position your offering and make it appeal to a niche audience.
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