Your Business Tip to
Work Smarter not Harder

Multiply Your Bottom Line Profits

Let me teach you the most important formula you'll ever learn in business. There's only 5 ways to grow our business.

Lead x Conversion = Customers x Number of Transactions x Average Sale = Revenue

Who are your leads? These are your potential customers -- the ones that contacted you.

Your conversion rate refers to the percentage of those leads that you turn into actual customers or the ones that purchase from you.

Now, multiply the number of customers by the number of transactions, that's your repeat business.

Your average sale, that gives you your total sales and revenues, multiply that by margins, and you get the take home profits.

People often ask me about three things: customers, revenues, and profits.

These are actually the least important concerns in your business. They're the results of the other 5 items.

The most important items you can work on are your number of leads, your conversion rate, your repeat business or the number of transactions you make, your average sale and your margins.

Let's put some numbers into the formula for it to make sense.

Let's imagine in your little business, you had 4,000 potential customers last year. You sold to 1 in 4 of them, or 25%. That means you've got a 1,000 customers in your little business.

Now, let's pretend that on average, they came back twice a year to buy from you. Some bought a hundred times, and some bought once and you never saw them again. But the average was twice.

Let's make it a $100 just for ease of math sake. Again, some spent $5, some spent $500.

Now if you look at it, that gives you $200,000 in revenues in this little business, 1,000 customers x 2 transactions x 100.

Let's make it easy and give you 25% margin to give you a take home profit of $50,000.

Now, we're going to work on five areas. We're not going try and double them. We're not going to try and do anything magic. We're only going to improve them by 10%.

If 4,000, we can get you to 4,400 pretty easily. In fact, you could probably do it by just 1 or 2 of the 80+ strategies we can teach you.

To increase your conversion rate, add that to the increase in your lead rate, and all of a sudden now, at 27.5%, which is 10% better, you're at 1,210 customers.

Then we got to work on repeat business strategy.

Again, more than 60 of those. In this case, we're only going 10% up, so that's 2 or 2.2

Then we go on to your average sale. We're only looking for 10% improvements in these areas. So a $100 becomes a $110.

Of course, we've increased revenue by 10% percent. No. No. No. That's what you thought.

But actually, it's a 46% increase. That’s $292,820.

By the end of the year, we get $80,525.50 in profits. That's a 61% improvement in your bottom line profits by just working on 5 areas.

Imagine what would happen if you increase it by 30% in each of areas.

The numbers become staggering.

You might get 10% in one area, 20% in another, 30% in another or even larger.

The bottomline is....The 5 ways presented real results for you to grow your business.

Connect with us here at ActionCOACH. Get in touch with us because we can help you multiply the 5 Ways of your business and increase your profits.