Why Put Off Until Tomorrow What You Can Do Today?

Time management is the number one struggle that entrepreneurs will face. Marketing, sales, and delivery of your product or service are all stressful elements, but they are made more so by the finite amount of time that we all have to get things done.

One of the best tools to help prioritize is to make a to do list of all the things you have on your plate. It can be a combination of work and personal tasks if you want to look at it holistically, although some prefer to do a separate list for each.

Next- use the ABC method to prioritize. Put one of these three letters beside each task.

A= Tasks that are both urgent and important

B= Tasks that are important, but not urgent

C= Tasks that are neither urgent nor important

By using this method you will be able to focus on the tasks that need the most amount of attention because they have the highest impact. The goal is to try and have most things on the list be labeled B or C- as most tasks that are urgent today are tasks that have not been completed when they should have been.

Taking the urgency out of your to do list means greater efficiency and less stress.

Thoughtful Thursdays - Increasing Sales Part 2

Last week we talked about coming up with a dollar value for incremental growth for the next twelve months. This number might be generated from from an across the board percentage growth over last year or perhaps a formula like the one listed below:

LY-CC+G1+G2+G3= Next Year's Forecast

• LY = Sales for the past 12 months
• CC = Core churn - business that will be lost for various reasons during the next 12 months
• G1 = Increases sales of existing products/services to existing customers for the next 12 months
• G2 = Sales of new products/services to existing customers for the next 12 months
• G3 = Sales to new customers for the next 12 months

I have used the above formula on a quarterly basis and incorporated +/- for Seasonality.

Whatever method or tools you use to come up with, your forecast for the next month can be expressed as a percentage of the previous years performance.

You have the number - what's next? Also mentioned last week, as food for thought for this week, sales growth comes from three areas:

1. Increased sales to existing customers
2. Sales to new customers
3. Price increases

If you analyze where your sales are coming from, it is likely that the majority of revenue is generated from a minority of customers. I am speaking of the 80/20 rule or Pareto Principal.

Take the customers that represent the bulk of your business and analyze each one's potential for growth next year:

• Will sales be flat?
• Are they going to buy more? - How much more?
• Are they going to buy less? - How much less?
• Can prices be increased or will they fall? - What will the dollar impact be?

For each customer have a detailed sales forecast by product or service purchased. If you have difficulty coming up with these details, get yourself to your customer and go over future sales expectations with them. Once that is done, add up the numbers and see where you stand. How close are you getting to the result you are looking for? What is the dollar gap you need to bridge?

Congratulations if your sales forecast can be satisfied with your existing customer base. In many situations however this will not be the case.

Take this week to review your forecast and go over the sales history for your existing customer base and get a good feel for what they will be purchasing over the next year.

Next week we will discuss ways to close the gap between what you expect to sell to your existing customers and your sales forecast.

Good Selling,

Richard

Wise Wednesdays - Pillar # 3: Reality Testing

Before I say anything about reality testing I would encourage you to reach for your dreams. It should feel scary. However, that should not be confused with just blindly leaping in the air and hoping that a net will appear. That kind of philosophy leads many people to come crashing down.

Reality testing is about being honest with what’s out in the marketplace, where you are in life and what you can realistically expect to make from your business. In short: Getting real.

Getting Real with the Marketplace
Poor market research is one of the key factors that most businesses fail. Although it’s important to be passionate about your business, in many instances it can get in the way of being objective about the marketplace because you so desperately want to be making a living doing the business. Getting real is about digging deep and finding out whether people are willing to pay for your goods and services? How much? Who is in the market now? What are the lead times in making a sale? Who is the ideal customer? Be prepared to substantially change HOW you go about setting up the business if research tells you to change your approach (as it inevitably does). Take out a successful business owner, ideally in your field, for lunch or dinner. It will be the best money you will ever spend.


Getting Real with Your Life
How is your personal life? Is it a mess right now? If it is this may not be the best time to start a business. Even at the best of times you will need a great dose of emotional stability. How are your finances? Do you have some cash reserves to dip into in hard times? Do you have a lot of outstanding debt? If so it’s best to clear that before you begin.

Getting Real with Making Money
How much money will you require to start the business and what will it be used for? Have you drawn up a month-by-month projected cash flow for your business with realistic time frames? Be very detailed. I have yet to hear an entrepreneur tell me, “Oh ya, I had all the money I needed and it happened quicker than I thought.” Most people are off the mark because they haven’t taken a hard look at what is involved. There is nothing wrong in reaching for your dreams. Just make sure you’re giving yourself enough time. If market research is the number one reason why most businesses fail to get of the ground then a poor cash flow is what will sink a business once it does get off the ground. Entrepreneurs ultimately are pragmatists. Reality testing is a way to step back and be as objective as you possibly can. You will need it time-and-time again.

Next week will be the last and most important pillar --- Pillar # 4: Character

Forgetful Fridays- Make People Care

The last Friday I wrote, I proposed that if you don’t know who you are as a business, your clients won’t be interested in what you have to offer. So if the first step is knowing yourself, the second is making your clients care about who you are.

The good news is that this can happen in a very organic way because you have genuinely defined who you are. Most people respond to people who are like them and businesses that fit their lifestyle. So rather than trying to convert people into clients- you speak directly to those whom you have things in common with. When you are consistent with your message, make the effort to get out and talk to prospects, and follow up- people will start to care. When they care about what you do, they will be more likely to make a purchase. 

Thoughtful Thursdays - Increasing Sales Part 1

An integral part of growing any business is knowing identifying where you want sales to come from. Over a period of time your customer's purchase history helps you develop a sales forecast. When you take your sales forecast and drill down into the details, your sales plan begins to take shape. Taking the time to crunch the numbers and set goals can help you maintain focus on the job at hand and lead to the faster achievement of those goals.

During the next few weeks we will investigate ways to help you develop a detailed plan for sales growth.

Having a percent growth target over the previous year is a very good place to start. From that point I have traditionally worked backwards to determine where the growth will come from.

For this week take your sales for the past year and come up with a dollar value for incremental growth for the next twelve months.

Next week we will look at ways to drill into your projected growth.

Looking ahead to next week, sales growth comes from three areas, this assumes that your sales will remain flat if you do nothing different year to year.

1. Sell more to existing customers.
2. Sell to new customers.
3. Raise your prices at existing customers.

Good selling,

Richard

Wise Wednesdays - Be Clear on Your Motives

Pillar # 2: Be Clear on Your Motives

People start a business for many reasons and their motives will vary. Yet if you’re not aware of the full implications for each motive you’re misguided attitudes will have you sinking faster than you can say Titanic.

Here are the most common reasons why people start their own business:

1. Be your own boss is the number one reason why people start businesses. However, this does not mean doing what you feel like. Decision making ability needs to serve what the business needs doing and many times they are difficult decisions –the type your boss has had to make!

2. Independence - You soon realize in order to succeed you need to be highly interdependent (not independent) with your customers, contacts, suppliers etc. Read the Wise Wednesday article posted on Jan. 28, 2009 to fully understand this concept.

3. Do work you love – The vast majority of your work in the beginning will be doing things you particularly don’t like to do like selling, managing money, administrative chores. Probably much more than you ever thought you’d have to do.

4. Make more money - You will probably make less money in your first two to three years in business then if you worked for someone else. If you absolutely need a steady paycheque then owning a business is not for you.

5. Flexible schedule – Some people really want to be self-employed because it gives them the freedom to choose their schedule. However, a lot will be dictated by the industry you’re in and most entrepreneurs put in more hours than working for somebody else.

Wise Questions:

Is this business venture something you feel passionate about that you are willing to invest in some financially tight years and many long hours?

Do you understand that the purpose of a business is finding and keeping customers at profit? (read the Wise Wednesday blog posted Nov. 19, 2008)

Are you flexible to change you pre-conceived notion on how and when it’s suppose to happen?

Stay tuned next week for Pillar # 3: Reality Testing

Thoughtful Thursdays - You Know, But Do They Know?

Most will agree that it can frustrating when one does not successfully communicate their message. Have you thought about also how frustrating it might be for the person you are trying to communicate with. In their mind it may be a very basic question they have asked and they can not understand why in the world it is so difficult to explain. It is two way street.

From a sales point of view this is especially important if the person your are talking to is a prospect. Knowing early when your message is not being understood is key. The onus is on you to keep the information flowing in a constructive manner to move the sales process along.

This speaks to knowing your audience. Learn by observation and apply what you learn when choosing your approach. For example, is your prospect detail oriented?

• Notice how the person is dressed - neat or sloppy?
• Listen carefully - do they like to be well organized and prepared or fly by the seat of their pants

If you are in their office:

• Is it appear organized or messy?
• Are there charts and lists on the walls?
• Are there organized stacks of files and magazines everywhere?

By observation you can learn about your audience and communicate accordingly. For example; if you recognize your prospect is detail oriented be prepared to take them step by step through processes you might describe.

Here is a short video that demonstrates a classic case of both parties not knowing their audience.

Good selling,

Richard

Wise Wednesdays - The Four Pillars for Savvy Entrepreneurs

For the next four weeks I will highlight one key pillar in setting-up a thriving business.

Pillar #1: Know Your Gifts

i. Experience – Do you have sufficient experience in the field you want to start your business? This may seem obvious but there are quite a few people who overlook this. Yes, I know you believe your idea is the greatest and latest, but without hands-on experience in the industry your chances become very slim. I hate to break the news to you but smart entrepreneurs are great implementers -- not innovators. For every great product/service in the market place there are probably at least a dozen other people who had the same idea – except they failed to act on it. Whether you want to run a clothing boutique, a courier service, or a high tech IT business working for someone else helps you experience the challenges you will have ahead of time. You don’t have to be the best in your field but customers need to know you have enough skill and credibility to do the work.

ii. Talents – Just because you acquired the skill or experience in a field doesn’t mean you WANT TO DO IT. A talent is an innate aptitude that you have. Your shining star regardless of any training or experience. These are things that come naturally to you like my brother who is great at fixing things or me designing workshops. We all have them. If the business you want taps into your talents that’s a good sign.

iii. Traits - How you like to work i.e. whether you’re organized or more spontaneous; whether you look at detail or go for the big picture; whether you like working alone or with others. If you’re not careful you could start a business working from home only to find out you miss the interaction you get in an office (it plays a larger role than you think).

When you start a business you generally fall back on what comes naturally to you. This may or may not help your business. So take stock: Know thyself!

Stay tuned next week for Pillar # 2: Be Clear On Your Motives

Thoughtful Thursdays - A Simple Way To Differentiate Yourself

We hear consistently how it is important to differentiate yourself from your competition. In my experience many new business owners initially plan to make their business stand above the rest by offering superior customer service, higher quality, or more competitive pricing. What really scares me is when a business claims to offer all three - see Wise Wednesdays - Do you want a cheap Mercedes?

A more successful sale person will do what the less successful sales person does not; in other words - MAKE A HABIT OF DOING WHAT YOUR COMPETITOR DOES NOT LIKE TO DO.

If you think and execute with the above in mind you will soon differentiate yourself from your competition.

Good selling,
Richard

Wise Wednesdays -- Who Knows You?

What’s wrong with this statement? “It’s who you know, not what you know that counts.”

I hear many people say the above statement. The implication is that having connections is more important than what you had to offer.

Most of us have experienced this at some point. You get a job because a colleague you worked with refers you. You land a sale because you personally know someone in the company. You get a new client because a cousin recommends you.

Some people also get cynical because they see things like this happening and find it unfair.

Whether it’s fair or unfair is up for debate.

There’s a greater truth: It’s not who you know BUT who knows you.

There’s a big difference. Just because you know me doesn’t mean I’ll remember you. The key here is to be memorable. Asking someone for business is one thing but taking the time to get to know that person, their concerns, their problems, their dreams and offering to help or giving them resources will make them much more appreciative of you.

So the next time you’re in a networking session, before you pass on your business card, take the time to learn about the other person and if you know of a way to help them then do so. Don’t expect anything in return.

Starting and growing a business, with integrity, involves more than just asking others to buy your product or service. Stop. Listen. Share. Care.

Sounds like leading a business (with integrity) are the same principles in leading a satisfying life.

Cheers,

Dominik