adding value

Protect the bottom line

by KineticIS on February 22, 2012 · 0 comments

When we are struggling to increase or maintain revenue we need to protect the bottom line!

I am not sure if it is because I am Scottish or because before my long career in the IT industry I was an accountant, but my obsession with spend control within an organisation is verging  on the obsessive.

small businessNow as a businessman I better understand the need to grow an organisation through sales, and indeed sometimes through acquisition. We all want our companies to grow and deliver better bottom lines whether that is for the benefit of shareholders or just for the benefit of the company.

In the current climate, growing a business by increasing revenue is a tall order and in some industries, with shrinking revenues. Often organisations try to maintain sales through discounting or sales, for example in the retail industry, which whilst helping to maintain turnover means that tighter margins and ultimately profits suffer.

Whatever way we look at it, growth is a difficult task and organisations start to look at ways of reducing cost. We have seen the reduction levels of staff within the financial sector and store closures in the retail sector.

The concept is simple – with reduced revenues the only way we can maintain profit is to reduce cost. Now I’m not saying there is no case for some redundancies or closing down stores that are not profitable, but controlling expenditure in an organisation is paramount.

So how do medium to large organisations get a grip on the expenditure? The answer is simple – improve your procurement systems and empower your procurement departments to deliver savings.

eProcurement delivers real savings to organisations through better control of spending and eliminating maverick spenders, in addition to reducing internal cost within an organisation.

The control of expenses for employees outside of the normal purchasing process is also another huge area for consideration. Most commonly, travel and accommodation costs incurred on behalf of the organisation need to be reclaimed.

In many cases the process to do so is a manual effort, with no validation or appropriateness checks. Claims get paid without authorisation or reference to the ‘corporate rule book’. A lack of control in this area introduces risk!

Aberdeen Research estimate that organisations are losing $260B in annual profits due to their inability to organise and analyse spend data and implement best practices to capture lost savings. That’s staggering!

The strangest thing is the ease that spend control can be implemented, the low-cost to do this and the incredible buy-in from end-user due to the simplicity of using these Web-based interfaces. This takes the hassle out of deciding what to buy and the requirement to have to think about account coding.

So my advice, to all Australian organisations with over 100 staff that are able to buy things, is to take a close hard look at protecting your bottom line.

eProcurement and spend control is the most sensible approach and best investment your company will ever make, not only in the difficult times but when the good times return.

Scott Graham, Director and spend control specialist for Kinetic Information Systems

General manager marketing and commercial at TorchMediaWhile the retail sector at large is still overcoming the low consumer-spending index of the past quarters for 2011, some leading brands and retailers are making the most of the recent lift in consumer sentiment.

A recent survey by the Westpac-Melbourne Institute released mid last month revealed a rise of 8.1% in the Consumer Sentiment Index taking it to 96.9 after it had fallen to some of the lowest levels in almost 2 decades.

Australia’s $292 billion retail sector has welcomed this rise with hopes for a more prosperous end-of-year period to boost the retail sector figures for the year.

With an expected Christmas spending of around $23 billion by Australian shoppers this year, many brands, marketing agencies and retailers are investing in shopper marketing strategies in order to win a greater share of the massive end-of-year spend.

TorchMedia, one of the leading shopper marketing providers in the country has been experiencing substantial increases in demand from brand managers and retailers alike to design and implement powerful point-of-purchase shopper marketing programs in time for Christmas.

Kirsty Dollisson, General Manager Marketing and Commercial at TorchMedia says, “Many retailers are planning to entice Christmas shoppers into spending from as early as October in order to beat their competitors for a greater slice of the expected Christmas retail pie.”

“Research tells us that Australians make a phenomenal 1.9 billion visits to shopping centres each year spending 50 per cent of their household income there. 64% of these shoppers usually take a shopping list, with some 58% of this group also making purchases that are not on their list. And, with another 29% of these consumers always purchasing items that are not on their lists, it is obvious why shopper marketing initiatives are so powerful,” Ms Dollisson explained.

In the US, 45.3% of the big retailers have employed shopper marketing over the past few years. A survey conducted last year showed that 64.9% of the big retailers are now allocating specific budgets toward shopper marketing, a massive jump from nearly zero only a decade ago.

With 70% of brand decisions being made at the shelf, we can easily see that shopper marketing will undoubtedly transform the brand marketing landscape in Australia over the coming years.

Media Brand of the Year Award winner, TorchMedia is the only media network solely dedicated to the retail environment in Australia, making them the authority on shopper marketing programs.

To discover how shopper marketing can benefit your brand or retail environment, visit www.torchmedia.com.au

Go to your largest business prospect or industry association and offer to do a study or analysis for them. This analysis must be valuable to them, and ask them how much they would be willing to invest for this study to be completed? When you have their answer, do not negotiate. Explain that you will be in touch within 24–48 hours.

Quickly determine if you are satisfied with the payment amount. If the answer is no, contact them and politely decline at the moment, but when they are able to increase their commitment, you will be happy to immediately proceed with the analysis.

If you are satisfied with the payment amount, contact them, thank them and explain you will be commencing work and arrange for the necessary details to be addressed and concluded.

To be successful with this approach you must clearly prove and explain why you are uniquely qualified to do this study, and that you have the necessary competencies to successfully deliver.

Your clients should always be directed towards focusing on the results you deliver and the credibility as to why your the best person to deliver those results for them.

Secondly, create a unique seminar for your prospects. This seminar should be designed so that your audience could, if they wished, implement your ideas without paying you and see an improvement in their situation.

At the conclusion of the seminar, you offer those in attendance a free 20-minute consultation with you one-on-one and ask them to complete a form giving you feedback along with their contact details so you can send them an e-mail newsletter or something similar.

During the 20-minute one-on-one you establish what their greatest need is that they sorely need fixing, and for which you have the competency to solve. During that consultation you make them the offer that they can immediately hire your services. And, add value!

Finally, send a letter to your top ten prospects making them an offer they cannot refuse. For instance, delivering certain results or your fee is zero. Then send a letter to ten other prospects or well-known colleagues, asking for one referral to a specific type of client. Follow-up these letters with a telephone call two days after you expect they would have received the communiqué.

______________________________

Ric Willmot - Executive Wisdom

Ric Willmot - Executive Wisdom

Ric Willmot is a professional conference speaker, OD consultant, and executive mentor http://www.executivewisdom.com

 

 

 

 

 

 

Without customers you have no business. But while some are great for your bottom line, others actually cost more then they bring in. You’ve no doubt seen them. The ones, who are quick to complain, slow to pay and certain to push the boundary by always wanting much more than what is understood to be the agreement.

write off bad clients

So what do you do with them? Spend the time to bring them around to your way of thinking, or tell them, politely of course, that they would be better off taking their business elsewhere.

Accepting every client that walks through your doors, just because you can, is wrong. Accepting every piece of business that offers itself to you, because the mortgage is due next month, is just as wrong, and will not solve your financial problems in the long-term. If you’ve got a problem client, they can sap all your energy. You’ve got to be willing to walk away from business. You have to have the courage to say no to dysfunctional business or customers.

Do the business you have committed to, but don’t contract for new business with that customer. If you revel in adversarial relationships, become a wrestler or a courtroom lawyer. The bottom line is that business is about success, not perfection. The best option is to catch the fatal amalgamation of frustrating, time-consuming and energy-setting customer traits and practices beforehand to prevent the needless expense and aggravation. A poor prospect will never make a good client.

Here are Ric’s Tips to determine which people you want to become your customers:

  1. Distinguish the target of opportunity – who is your target market?
  2. Prepare for success by acquiring new business, which you want; have the confidence to engage customers as peers.
  3. Always build relationships, don’t just do business.
  4. Be prepared to difficulties and objections.
  5. Always looked to gain market share in the areas you want to be positioned.

The pharmaceutical industry has shown for the past seventy years that businesses could still flourish despite ranking some customers ahead of others. The pharmaceutical industry classifies doctors as A, B or C. Those classified as “A” get their complimentary tickets to major events delivered personally; those in category “B” get them in the mail; and the category “C” doctors get a call from the telemarketer.

Every organisation needs to set its own criteria for each category, dependent on what their driving force is. And, if you want to work with category “C” customers, then you must provide the best service you can because you’ve chosen to work with them.

If you’re unsure of implementing such a seemingly drastic strategy, do the math. Place a dollar value on your peace of mind, perhaps $20 or $100 per hour. Multiply that by the number of hours a particular customer has distracted you from other, more profitable considerations, and add it to available financial measurements of how badly you’re bleeding by continuing the relationship.

Take responsibility and get on with your business and allow the customer to do the same. It’s best for both of you!

______________________________

Ric Willmot is a professional conference speaker, OD consultant, and executive mentor http://www.executivewisdom.com

Ric Willmot - Executive Wisdom

Ric Willmot - Executive Wisdom

  • What’s holding you back?
  • What’s slowing your progress down?
  • What’s stopping you from moving forward?

These questions relate to you attracting all the clients you need to have a full business. Having worked with many clients over the years, I’ve seen it all. Other than “no knowledge of marketing,” one thing seems to come up over and over again, and it happened again recently, with a brand new client.

The client answered this: “Sometimes, the ‘Little Voice’ inside me asks, ‘Who needs my services and programs anyway?” This is basic information that I offer. People already know this stuff!” This statement is so common, but in almost every case, this is absolutely not true!

I have to confess, in the past, I too have taken for granted what I already know and teach everyday and started questioning my value in the marketplace. For example, when I was teaching about niche branding, I sometimes wondered why people were paying me (or WOULD pay me) to teach them the difference between what is a brand versus just having a logo. To me, it was a no-brainer that branding throughout your whole business was more crucial than just having an appealing logo. But to a person who knew nothing about branding, it was crucial that I explain it to them in detail, and then the shortcuts on how to change their business into a recognizable brand and how to do it fast.

adding value to your business

I would question the value of the ‘how-to’s of marketing I gave clients in every meeting. As I was stepping out the campaign relating every step back to their objectives and target market, I couldn’t help but think ‘Are these simple steps REALLY of value to them?’ (I’d been through marketing degrees, did large corporate marketing and serious small business marketing boot camps, so niche marketing came naturally to me.) But clients keep asking questions and referring other clients. Go figure!

Even in the early years of my marketing consultancy and coaching, I sometimes wondered about my value. Clients asked me daily about the secrets of getting clients to call THEM and making money with smart marketing techniques and even smarter systems. For me, it was now ingrained and like second nature. I took for granted that I knew it, and because I’d been doing it for so long and knew that it worked, I thought everyone knew it too and that it was common sense.

However, what’s common knowledge for you is a secret to someone else. Because we are “immersed” in our information all day long, and for years, we start taking for granted what we know. We forget what we know is actually a secret many others would do anything and everything to discover. It becomes the answer to their most pressing problem. It becomes the solution others have been praying for. And that’s when they call us.

If you’re in this position, you are probably OVER-estimating what everybody else knows. The more you think what you teach is common to YOU, plus the longer you do what it is you do, the more you tend to undervalue what you know.

The funny thing, as I’ve discovered, is that the more we teach things to our clients in SIMPLE terms, the happier they are, the more referrals we get and the more we make. It’s not the elaborate teachings that people are looking for. It’s the practical and simple solutions.

The disappointing thing about the whole undervaluing what you know is that as a result, you may be undercharging for what you offer. This is actually one of the major reasons why most people don’t have enough clients. Because they don’t see value in what they offer, they don’t charge enough, and therefore there is a low perception of value from the prospective client’s point of view. They then go somewhere else for the exact same information. Talk about a self-fulfilling prophecy!

Some entrepreneurs even go so far as discounting their services, or offering a sliding scale, because of their lack of confidence and low perception of value in what they offer. In my book, discounting is a BIG no-no. Again, it portrays a devalued product or service and it’s NOT Client Attractive.

Look at your business today and ask yourself these questions:

  • Did you clients come to YOU for the information you take for granted?

Sometimes, they may even have known some of what you know, but didn’t have the discipline, accountability, resources or structure to do it on their own. Many of my clients KNOW how to attract other clients, they’re already somewhat successful, but they don’t have the discipline or accountability to do it consistently on their own. So we do it together. This is actually my favorite type of scenario, because these clients are very driven and since we’re not starting from scratch in the learning process, we move at warp speed.

  • Are you super confident in what you offer?

Read your testimonials over and over until your confidence comes back. If you don’t have any testimonials then ask your current happy clients for some.

  • Do you see yourself as their problem solver?

Your clients do see you as their problem solver. So charge accordingly and never ever discount your services, better still put them up!

 If you’re not sure how much to charge or how to position your value in the marketplace, then it’s time to take action and invest in a step-by-step marketing system that will feel easy and authentic to you. The Easy Marketing to Get Clients Home Study System™ avoids all the unnecessary stuff and instead gives you the most important things to do to get out there in a big way, set up simple, solid systems, so you consistently fill your pipeline and continually get new clients. It’s all step-by-step, and easy to understand. So, you do step one of the system, and when you’re done with that, you move on to step two, and so on. So simple and all the tools, scripts, templates, and examples are handed to you on a silver platter. You can get it at easymarketing.com.au.