Imagine you’re the CEO of an established private healthcare business when the economy plunges into the worst downturn since the Great Depression. Up to then, your team has delivered extraordinary results; your bottom line is growing steadily each year and your services are recognized as world class by the hospitals, city councils and large public health facilities that refer work to you.

Imagine choosing that time to tell your Board and senior management team that, in essence, you want to walk away from about half of that business and pursue a very narrow niche market.

No doubt, you may at this point be imagining yourself out of a job. But hear me out…

As you may have guessed, this story is not a fictional one and the “you” in the story is actually a business coaching client of mine. I’m happy to report that the discussion with the Board went quite well, the business has nearly doubled since that day, and my client is still the CEO.

And along the way we both learned some valuable lessons about how to increase sales and become the dominant player in the marketplace. In fact, there is a big difference between being just a good company and being one that your customers can’t live without.

Solve Your Customer’s #1 Source of Pain
Consumer sentiment and spending have decreased dramatically in the past few years and those changes are being felt across every industry. Everything you thought you knew about your customer and why he/she was buying from you has probably changed. And if you do not take the time now to re-discover your prospect’s main source of pain and the reason why she needs your product or service now, you will never increase sales. In fact, you risk losing more sales and more ground to your competition.
Now some of you may think – but my industry is different

Do you aspire to be a great leader and grow your business profitably this year? Then it’s time to find the right business coach who can inspire and empower you to step up and reach your goals.

Almost every business is under pressure right now to attract more leads and close more sales in this tough economic environment where global competition is increasing every day for your potential audience.  It is hard enough to keep up with the changes in your industry and the barrage of ads that target your potential customers – not to mention the innovation in technology, increasing complexity of running your business and complying with the tax legislation, HR issues, operational challenges and business planning. Having a Business Coach isn’t a luxury in this day and age, it is a necessity that you need in order to survive and thrive.

By far, one of the biggest assets that you will gain as a result of working with a business coach is accountability. Remember, it’s difficult to get a truly objective perspective or opinion from yourself, your spouse or your team members, but your business coach is there to be your “unreasonable friend” – to tell you the truth, challenge your assumptions, push your boundaries and motivate you to take action (especially when you are procrastinating).

A Business Coach or mentor will teach you “how to fish” rather than simply putting a fish in your hands when you need it. With years of successful experience (running their own business and helping hundreds of other entrepreneurs just like you), your business coach will help you develop and achieve your goals, put a solid business plan in place, execute effective strategies that will grow your bottom line, track and measure your progress and highlight blind spots or opportunities that you have overlooked.

You may be able to scrape by without the help of a business coach, but it’s almost impossible to consistently grow your business profitably without the training, guidance and focus you will achieve by working with a good business coach.

Find out more today by contacting us to speak to a business coach that can help you breakthrough your perceived limitations, make better decisions, step up as a leader and achieve your goals.

And remember, most importantly a business coach will:

• help you focus and eliminate all tasks that are taking up resources but adding value
• challenge assumptions and perceived limitations about your business and industry
• motivate you to ask better questions and make better decisions
• highlight opportunities or pitfalls that may not be obvious to you
• give you tips and proven strategies based on years of experience across many different industries
• be a valuable sounding board and provide a balanced, objective perspective
• help you develop and execute plans that grow the bottom line and cash flow safely & predictably
• track and measure your financial progress in a way that is meaningful to you
• assist with an exit strategy
• be your unreasonable friend with a wealth of experience across multiple disciplines – marketing, sales, training, systems, leadership, finance, legal issues and technology.

If you’re in business, one of the most important questions that you must be asking yourself is “what is the best way to grow your business?” How can you take what you have, expand on it but keep your costs as low as possible?

Fortunately, history has given us plenty of good examples of how NOT to do this. Perhaps the best of these happened in 2001 – when thousands of companies went under in the dot com bubble.

But how did so many go so far wrong?

In those days, start-ups (with little or no income) and existing companies (with dreams of expanding their business online) were renting the biggest and best offices. They were signing huge print advertising contracts, paying ridiculous sums for banner ads and taking enormous salaries.

When sales were lower than expected and the cash to keep paying all those expenses dried up, these businesses had no way of easily adjusting their monthly expenditures because they were primarily FIXED, not variable. Their only option was to declare themselves bankrupt and close down.

Compare this situation with Amazon.com which started in a suburban garage with old doors on sawhorses for desks. By keeping fixed costs down, they were able to stay in business long enough to start generating a profit. They are now a huge company (with real offices) making huge profits.

So how does all of this apply to your company?

No matter how big your current business is, the aim is to grow your business while keeping your fixed costs as low as possible as a percentage of sales. And there are many practical ways to do this.

Begin by creating a simple excel spreadsheet of your current revenue and expenses each month. Ensure that you have correctly separated the fixed and variable costs of doing business. Roughly speaking, the breakdown should look something like this:

Revenue
- Cost of Sales (includes cost of goods and wages for subcontractors)
= Gross Profit
- Fixed costs (includes rent, wages, marketing, telephone and utilities etc.)
= Net Profit

Based on your current financial results, set your monthly revenue targets for the next 12 months and estimate the cost of goods sold. For example, if you currently generate $20,000/month in sales with a 60% gross profit margin, you might like to grow your business by 25%? Therefore, you would use a projected sales target of $25,000 each month with Cost of goods sold at around $10,000 as a starting point. This would leave you with a gross profit each month of $15,000. If your sales fluctuate each month due to seasonal variations, manually adjust your forecast to reflect these ups and downs so that you will have a more realistic picture of your financial performance.

Now here is where most business owners will go wrong…

Most business owners will make the mistake of assuming that fixed costs are fixed – the owner will just blindly start to place the existing amounts for rent, marketing, wages, telephone etc. into the financial projections. Fixed costs are referred to as fixed because they are fixed at a point in time. This does not mean however, that they are fixed forever and cannot be altered. In fact, when you are preparing a business plan and financial projections to grow your business, you should consider almost every aspect of your business as “up for debate and re-adjustment”.

That is one reason why you need a decent business plans – you can use it to re-evaluate and plan for the future so that you can improve and grow your business. Without a concrete plan, in all likelihood, you will continue to get the exact same results that you got last year.

Where you will get the most value in this exercise is by going back over each cost (fixed or variable) to identify opportunities to improve your gross and net profit margins. Cutting costs may be possible and advisable in some areas of your business. However, cutting costs [in isolation] is not usually an effective strategy to grow a business. In order to grow and improve your bottom line, you will need to ask yourself the question – “how can I grow my business without expanding costs”?

Here are some effective ways to do just that:

1. Think of ways to partner with others to expand your reach and sales without actually having to open another location or hire more full time employees. You may already have underutilized capacity to increase your sales right now.
2. Introduce products or services that complement the ones that you currently have and contribute more to the bottom line of your business.
3. Re-negotiate the terms or prices you have with your suppliers to increase your gross profit margin.
4. Selling online is a very cost effective way to increase your reach without increasing fixed costs.
5. If you manufacture goods, you could identify ways to increase production simply by tidying up, rearranging the layout of machines and planning more cleverly (to reduce work in progress and downtime). Often mistakes and rework can be costly to your business and surprisingly, they can be prevented by taking time during the business planning process to brainstorm solutions. Making better use of time is another fantastic way to increase production with minimal impact on fixed costs.

Surprisingly, 95% of business owners never take the time to create a business plan and forecast of revenues and expenses. Of the 5% that do, only a small portion refer back and measure their progress against their key performance targets. That is the number one reason why so many businesses either don’t make much profit, or worse, go under, each year.

A business plan doesn’t have to be 50 pages in length and take 200 hours to complete. It just has to be realistic and useful. To do this properly, follow my basic outline for projected revenues and expenses above. It should only take 48 hours of your time. 48 hours, in exchange for more sales, more profit and peace of mind, is a small price to pay.

If you had to pick 1 thing – 1 strategy or change that you could implement in your business that would allow you thrive despite tough economic times, what would it be?

Let’s make a list of the top 5 things that I hear most business owners (like you) say when I ask them the same question…

• Spend money on marketing  – attract new customers
• Have a sale
• Ask for referrals or help
• Tighten your belt – cut costs
• Do more networking

Now what do all of these have in common?

They all involve you doing more of the same thing that you have always done.  None of these involve a radical shift in the way that you do business, do they?  None of these involve you taking a step back and re-examining what you do and whether it’s actually working. And none of these involve you changing the way that you communicate what you do to your customers.

And that is precisely why none of them will work to recession proof your business.

So why is that important?

Because consumer sentiment and spending has changed dramatically in the past few years and those changes are being felt across every industry and by both big and small businesses.  Everything you thought you knew about your customer and why she was buying from you has probably changed.  And if you don’t take the time now to re-discover your prospect’s main source of pain – the reason why she needs your product or service – you risk losing more sales and more ground to your competition.

Now some of you are probably sitting there thinking “but MY industry is different.  You may think that you’ve been hit especially hard and that everyone in your niche has lost sales.  But that’s not the case for 99% of you.  Even some of the most competitive and vulnerable industries have companies who have continued to perform well and who have even stole market share.

Just for a moment, I want you to cast your mind back to the first few months after the GFC. A lot of people lost their life savings during the stock market crash and many lost their jobs immediately after that.  It was a horrific few months and few industries felt the wrath of the crash more so than the automotive sector.  If you remember, new car sales dropped by almost 20% in a short period of time and stayed that way for almost a year. That’s a huge drop in an industry that is vital to the health of the national economy.

Now sales of new cars were down 20% for the industry.  Despite the massive drop in sales, 1 manufacturer actually managed to gain market share and outperform all other companies in sales growth.  Do you remember who that was and why?

Only 1 company stopped and took a good hard look at the pain their customers were in at the time. They didn’t do what all the others did – which was spend more money on newspaper ads, lay off salespeople and slash new car prices.

Only 1 company examined the change in the market, correctly diagnosed the pain of their prospects and came up with a solution.  “If you lose your job and can’t make the payments, no problem – we will take it back free of charge”.

Do you remember who that was?  That’s right Hyundai.

With one simple change to their focus and strategy they stole market share from every other manufacturer because they correctly identified the shift in their customer’s pain. They didn’t keep going on with the same old strategy and approach that clearly wasn’t working. Yes, there had been a major downturn and the whole industry was hit hard, but there were still lots of customers who wanted to buy a new car but were afraid to do so because they might lose their jobs.

So how can you apply this to your market right now?  First and foremost, your customers are not thinking about you, your brand and your features and benefits – they are thinking about their own survival and whether or not you can cure their pain. If you are able to correctly diagnose the pain, you will trigger the part of their brain that makes decisions and you will stand apart from your competition. That’s the power of Sales Seduction.

Think about one of your customers right now and her pain?  What do you need to do in order to get more clarity around that?  What questions do you need to ask her about how it is affecting her financially, personally and strategically?  To the extent you can diagnose her pain, get her to acknowledge it and put forward the solution that cures it, she will listen to anything that you have to say.

Take a look around you… businesses are closing their doors everyday – which means more potential customers for the businesses like you that DO survive. And in times like these, it’s going to take more than just doing more of what you have always done to recession proof your business. Uncertain times call for deliberate decisions and proven practices.  In order to recession proof your business you need to shift your thinking around the way you do business and start providing THE solution to the #1 pain or challenge that your customers have.   And if you need some diagnoistic questions and a step-by-step framework to help you do this…I highly recommend that you check out Chapter 8 of Sales Seduction.

While only 2 pages in length, the executive summary is by far the most  important component of your business plan or proposal. It is designed to  summarize the key elements, capture attention and most importantly, showcase the  financial highlights.

So, if you only have 2 pages to convey a significant amount of information  and summarize the financial upside, how do you decide what to put in and what to  leave out? Which financial features are critical to emphasize?

Depending on the purpose of your document and the intended audience  (investment, sale, partnership, strategic alliance, joint venture etc.), you  will want to tailor your financial disclosure to suit their needs and  expectations. What would they want/need to see in order to make an informed  decision?

At a minimum, you need to clearly state what financial input is required from  them and what they will get in return – i.e. a share, debt instrument, license,  exclusive right etc. Next, highlight the expected net profit and cash flow over  2-3 years. Also, give a clear indication of return on investment (ROI) AND a  realistic, well defined exit strategy.

In an executive summary, it is important to be succinct and focused. It is  not the time to tell your life story, overpromise with unrealistic projections  or overwhelm with too much detail. You will only get one chance to make a good  first impression and capture the attention of the reader. In fact, many  sophisticated investors have told me they rarely read a business plan or  proposal in its entirety. They make their decision on the strength of the  executive summary and their assessment of the owner/manager (in terms of  character, knowledge, skills and tenacity).

Focus on “what’s in it for them”. Show them clearly how they can benefit and  when the result will be crystallized. Give them enough detail to understand the  industry, opportunity and unique solution you provide. And most importantly,  clearly summarize the key financial metrics of profitability, cash flow and  ROI.

In short, make it EASY for them to invest in YOU.

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