Boost Profits In Four Simple Steps

One of the most common mistakes companies make when they are trying to boost their profits is to try and get new customers. Typically this behaviour is a reflection of their history. When they were new, they probably had zero or just a few customers. To survive, they had to get more. Getting new customers made sense.For companies that are out of survival mode, and are instead trying to boost their profitability, acquiring new customers is not the best strategy.

Studies by Cap Gemini and Gartner Group have shown that depending on the industry, it costs 3-7 times more money to acquire a new customer than to get an existing customer to make a new purchase.The best profit boosting opportunities lie in optimising the relationships you have with your existing customers. Here are four simple steps to do just that.

Find and Strengthen Your Pillars

Do you know which five of your customers contribute the most to your bottom line each year? Can you name them off the top of your head? Can all the employees in your company name them? If not, that is a problem to be addressed, and addressed quickly.

Depending on the size of the organisation, a loss of any of the top five customers can range from serious to catastrophic. These clients are the pillars supporting your company. Think of your business as a structure sitting in the middle of shark infested waters. Five pillars are arranged in a circle and your business balances on top of them. What happens if one or two of those pillars shrink. What happens if one of them goes away completely?

Part of the key to optimising profits is securing your pillars. If you look at the amount of time your organisation spends on customer service, and break it down by customer, would you find that your “pillars” are the five customers who get the most service?Most likely they do not. “Problem” customers usually command the most attention, followed closely by efforts to get new customers. Change that. Focus a proportionate amount of attention to customers based on how critical they are to your business.

Take the resources being applied to the problem customers and focus them on the pillars. Task those people with making your relationship with the pillars so strong, that they will never crumble. Challenge them to find ways to help the pillars be successful. Be a pillar to your pillars. 

Inventory Your Offerings

Starting with your pillar customers, take an inventory of all the products and services that you currently provide. Rank them in order of profitability. When all the offerings have been identified, categorise them from one to five. Ones should be the twenty percent of the offerings that are most profitable. Twos will be the next twenty percent, on down to five, which will be those products and services that are in the bottom 20% in terms of profitability.

Now comes the interesting part. Create a grid with clients across the top, and offerings down the left side. Arrange the clients in order of how much they impact your bottom line. The client with the most impact should be the first one, and the least impact client should be the last. For the offerings, which are on the left side of the grid, keep them in order of most profitable to least profitable.When you have finished creating the grid, go through and for each client put check marks on the products and services you provide for them. This is your profitability map.

Attack the Gaps

Look at your pillars. How are you doing in terms of providing your full suite of offerings to them? Any boxes without checks represent an opportunity for you to solidify your relationship. Start with the offerings that are ranked low and not being used by your pillars, and focus on getting those blanks filled in.Now look at the rest of your map. Where are the check marks? Where are the gaps?

Every gap represents an opportunity to boost your profits. Start with the more profitable clients, and try to fill in all the ones and twos. Educate those customers about the additional products and services you offer. Find out what needs they have and identify ways you can fill them. These efforts will not only strengthen your relationship, but it will also make them more profitable clients for you.

Learn From your “Lovers”

As you are implementing the above step, take another look at your graph. Find the five customers who use the greatest percentage of your products and services. These are the customers who just love what you do. They represent a tremendous learning opportunity.There is some reason or group of reasons that these customers love you so much. If you can find out those reasons, you can apply that knowledge to the way you interact with the rest of your customers.  

Perhaps a particular salesperson has figured out something that is really working. Maybe the account representative or customer service contact is particularly good. Whatever the reason is, you need to know.Interview those “lovers” and learn from them. If they say it is because of a particular person in your company, interview that person and find out what they do that is working so well.

Within those interviews lies profit boosting information. Gather it and then apply the learning to the way you interact with your other customers. Again, start with the pillars and then work your way across the customer list.Most organisations acquire customers by filling a single particular need. The key to boosting profits is not to go out and get more of those customers. Find and strengthen your pillars so that your organisation is well supported, inventory your offerings, fill the gaps, and learn from your “lovers”.

These four steps are the way, to boost your profits and to ensure business success.

http://www.adversityovercome.com

http://business-success22.blogspot.com

Providing Excellent Customer Service Part 2

Customers and clients are becoming increasingly disenchanted with the merely adequate. For them, extraordinary service is the rule, not the exception. Anything less and they’re happy to vote with their feet and their wallets.

For business success you need to help your business establish and maintain an ongoing climate of service excellence.

Share Information 

If you run a retail business, business management tools, can be invaluable in tracking critical data, such as what items and services are selling particularly well.  If you have that data, don’t keep it a state secret.   Sharing the information with your employees lets them know what is hitting on all cylinders.  It also helps them promote these products or services to customers.  Sharing information with others is a really positive step.  In other words, don’t keep critical customer information close to the chest. That holds true with businesses other than retail. 

Customer Relationship Management, (CRM), software lets you share valuable information about clients and customers with your entire organization. Customer buying habits, particular needs, interests and other data can be stored in a central location and easily shared.  

Share The Commitment. 

Nothing can prove more destructive to a commitment to extraordinary service than management for whom the concept is little more than lip service.  Walk the walk by buying into that commitment just as much as you hope your people will.  Make sure you reward top performance.  Invest the time and expense in any sort of training that may help employees carry out and maintain high performance standards. 

Don’t forget yourself and others in the front office.  Make sure that training takes in everyone, not just sales, marketing and other front line employees.   Training is an important part of creating a lifelong culture for service excellence since it helps build an understanding of the concept of service.  And that means a top-down commitment.  Leadership should set the tone for the entire effort. 

Don’t Expect Magic Overnight 

Another potential hurdle to extraordinary service is the expectation that it’s like flicking a light switch, on it goes, and everything’s hunky dory.

The truth is, exceptional service takes time to take hold in an organisation, particularly one with an array of people and departments.  Give it enough time. Review performance every four to six months.  It is essential to stay the course so you can improve service ratings. 

Expect Mistakes And React Accordingly 

The road to top notch service is not without its bumps. Don’t pretend they are not there.  Rather, make them a part of the journey by acknowledging a slip up and, in so doing, recommitting to extraordinary performance.   

For example, if a customer receives the wrong item, don’t stop at making sure they get the right one.  Let the customer know that you are sorry for the mistake and build their confidence that it will not happen again.  When you apologise for problems and really listen, you build a relationship.  Build customer loyalty, not just satisfaction.

© James Chapman Business Leader Coachinghttp://www.adversityovercome.com

http://business-success22.blogspot.com

Providing Excellent Customer Service Part 1

Customers and clients are becoming increasingly disenchanted with the merely adequate. For them, extraordinary service is the rule, not the exception. Anything less and they’re happy to vote with their feet and their wallets.

That makes extraordinary service necessary, not just desirable. And that, in turn, mandates a strategy to help ensure that your business matches that special service standard on a daily basis.

For business success you need to help your business establish and maintain an ongoing climate of service excellence.

Define What Extraordinary Really Means

It’s an easy term to toss about, but knowing what exceptional service entails is essential to establishing the procedures and the mindset with which to achieve it.  So, delineate what extraordinary means, is it lower price?  Keeping appointments on time or making certain that telephone service reps always say “please” and “thank you”?

By knowing precisely what is merely good enough, and what takes your business beyond that, you get a firm handle on what you need to do to hit that goal on a consistent basis.

That means calling a customer to let them know that the van they are expecting is going to arrive on time. “We pledge to arrive on time, in a clean shiny truck, with two friendly uniformed drivers,” but so can anyone.

What makes it unique is if the truck crew call the customer 15 minutes ahead of time, and let them know they are on time.  This has a huge impact on the customer.  Calling ahead sets exceptional expectations, even if they are running late, the customer appreciates the call in advance.

Ask If You Are Not Sure

Many companies may find it understandably difficult to genuinely pinpoint what extraordinary service really entails. So, do some legwork. Conduct focus groups with customers to see what they really value. Ask your complaints department, if you have one, to identify topics that are frequent targets of dissatisfaction.

Often, you may find extraordinary translates to a holistic grouping of issues, not just one product or service.  Being extraordinary means offering someone a truly exceptional experience.  The quality of something may be good, but it’s the overall experience that will really define customer loyalty.

Allow Your People To Be Extraordinary

Saying you would like to have extraordinary service and actually carrying it out is a tough nut without the necessary authority. 

One of the biggest challenges of providing a consistently top-drawer performance is shifting conditions.  What’s appropriate for one customer may not work with another. 

For instance, one customer may be so dissatisfied that a partial refund may be in order.  By contrast, other customers who are a bit less peeved may be happy with a problem solved without any sort of refund.

So, allow employees reasonable freedom of choice to read a situation and react accordingly.  For instance, giving employees a budgetary allotment which they can use, as needed, to address refunds or other unexpected costs associated with giving customers the benefit of the doubt.

Tell A Friend About Business Leader Coaching

© James Chapman http://technorati.com/tag/Business+Success

Business Success – Free Business Advice

From today onwards, business success is going to be a lot easier to achieve for any business, no matter what its size may be. 

The company, Adversity Overcome, which is famous for its ‘success secrets for business’ and for training organisations and their people “How to Overcome Adversity and Be More Successful” is launching a new free service, called “Business Success” 

James Chapman, CEO of Adversity Overcome said “In this information age, success in business should not be determined by the money in the hands of a few, but by the information in the hands of many.” 

He went on to say, “Success or failure in business should not be because a few words of timely business advice have not been given.” Business Success, which is powered by Google, Blogger and Feedburner will be a free business advice service, available wherever and whenever it is needed, 24 hours a day. 

From now on, a search on Google for ‘business success’ will bring you just that. Success in business brings profitability to organisations and monetary, lifestyle changes to individuals. 

Business Success:           http://business-success22.blogspot.com 

Adversity Overcome:        http://www.adversityovercome.com