Grow your business!
As promised, I thought I would go through how to grow your business. The topics I plan to cover over the next few weeks are:
- Targeting the right growth – Why do we want to grow and our ideal clients.
- The 3 ways to grow your business…. Increasing your new customers, increasing the number of times existing customers purchase from you and increasing the average sale. They are not equal, one will suit your business more than another and each have a different cost of implementation.
- Retention – Don’t forget retention of existing customers!
The first and most important tip of this article…..lets start at the start…. why do we want to grow and what is the “right” type of growth? In my experience, too many people forget to start here and think marketing campaigns or social media strategies first. Always, always, always… start at the start.
Firstly, lets cover WHY do we need to grow…. Ask yourself these simple questions:
- Are you a new business and growth is vital? Is it a… I’ll take anyone type approach early on…
- Is it to expand? If so, this may help you determine your ideal client type (see below)…. location may also play a part if you are expanding into a new location…. or maybe its a new market/segment.
- Are you trying to replace customers that are leaving…..do we need to consider a retention strategy instead? Quick tip…. complaining about your price, is not a valid reason for leaving in a lot of cases. There are lots of car types, each has its different price… so why do they all sell? It comes down to “value”…. each of the customers has seen a different “value” in each of the cars…. if people are leaving purely on price, then you need to question and adjust your value proposition.
- Do you have capacity to handle the growth? Often people will seek growth, but are too busy now…. so is it growth you are seeking or a better client? Will you have time to service the customer needs?
- Will the growth result in more profit…. or have you just assumed it will? An accountant can help you map out this and possible constraints or hurdles of the growth…. before they become an issue.
- What are my unique selling points (USP) or market difference? What am I doing that others aren’t…. be careful here. If you can’t provide something different, you will be competing on price… which can be hard. If you say service…. it will have to be exemplary… most businesses say service…. so you can’t all be different. Try to get more specific than service…
These questions will hopefully help focus your effort on the right type of growth.
So what is the RIGHT type of growth? I define it as growth in your “ideal” clients.
Sure, you could put an advert up on the web, broadcast it during prime time TV, or launch a radio campaign… but will it reach your ideal client types and will it get them to come see you. Will you be too busy dealing with clients you don’t really need?
I am not a marketing expert, so I don’t propose to debate the merits of each marketing type or which one best suits you and your ideal clients. I will leave that to the marketing gurus. What you need to provide to the marketing guru’s with, or you need to know if doing it yourself, is what is your “ideal client”.
To determine your ideal client, ask yourself these simple questions:
- What characteristics does my ideal client have? Age / sex / income / hobbies / qualities – ethical, aggressive/ interests / location / industry / other characteristics…. the more you can come up with, the closer you will be to identifying the next point. They must have the capacity to pay you for your service.
- Where can I find more of them and who else might have contact with them? Are they members of clubs, do lawyers or banks have the same clients, are their professional bodies or expo’s, are they location specific so-on.
- Are they nice? This is one of my recommendations…. see my prior articles on who a customer is (8 things to make you think about your business differently)… An ideal client should be someone that you can make money off (profitable)…. pays you….. and is nice. You shouldn’t work for anyone that isn’t profitable or nice to deal with (preferably they should be both).
Ultimately, to grow your business effectively you should be trying to grow your ideal clients. This will not only help you to be more profitable, but it will also ensure any marketing you do will be targeted and more cost effective. So start and the start and work through this first…. you will be surprised what a difference it can make.
Use your accountant (Holmans) like a coach…. an athlete has a coach…yet the coach is not as good as the athlete…. So why do they have one? The coach is there to challenge them, make them accountable, act as a sounding board, identify hurdles or issues before they develop and drive them to achieving their goals…. your accountant is the same for your business.
Hope this has helped. We will cover the other topics in the coming weeks.
Wayne Staal CA
Holmans Accounting and Taxation is an accounting firm located on the Sunshine Coast Qld (Noosa and Maroochydore). We specialise in Business taxation and advice, Accommodation industry clients and Self Managed Superannuation Fund services. We service clients all over Australia.
