My Business Manager offers Instant Insight for Business GrowthIan McManus
Business growth is an essential consideration for any business. After all, if something is not growing, it is dying. There are only 4 major ways of growing a business.
My Business Manager provides the regular Business Snapshots and management reports you need to decide the appropriate strategy, and measure the results of your activity.
1.Increase the number of Customers or transactions.
2. Increase the average value of existing transactions.
3. Increase the Gross Profit Margin on your products and services
4. Introduce a new product or service
Business Growth 1 – Increase the number of Customers or transactions
My Business Manager will show you this data on the Business Snapshot report. Increasing the number of customer or transactions means adjusting your marketing mix, or discounting your products and services. There are complex factors to be considered when trying to grow with this method.
• Set a budget and document what gains that you expect.
• Insist that it be measured regularly.
• Make sure the cost of getting a new customer is in line with the lifetime value the customer brings.
• Be wary of discounting. There is a direct relationship between the size of the discount and the volume of increased business required to gain significant growth.
Business Growth 2 – Increase the average value of existing transactions (“Do you want fries with that?”)
My Business Manager will show you this information on the Business Snapshot report and in the Performance KPI reports. Every sale is an opportunity to offer additional goods or services. Paint buyers need solvents, brushes, rollers, ladders, ground sheets, colour consulting, or recommended professional painters. Customers are already in “buying mode” and are more receptive to your suggestions.
Business Growth 3 – Increase the Gross Profit Margin
You can increase your margins in three ways.
Price – Schedule a price increase (or at least a review) every six months at minimum. Review the selling price each time that you purchase new stock if the price has changed. Be aware of competitive pricing. (Ask your accountant for advice).
Cost of sales – You must know the true cost of any item that you sell, including labour, commissions, packaging, credit terms. If you are not sure, ask your accountant to help to identify the true cost. Think about how you can reduce your costs. Can you buy cheaper, locally, can you import directly. Can you avoid transport costs, ship directly to the customer?
Mark-up – Understand the relationship between mark-up and margin (a 50% mark-up on costs will provide a 33% margin on sales). What are the mark-ups for your industry? Ask your accountant or ask an industry body. will show you the average Gross Margin and Net Profit Margin on the Business Snapshot and detailed information on the Profit & Loss traffic-light reports.
Business Growth 4 – Introduce a new product or service
This strategy requires investment, planning, test marketing and caution. It is usually more important when a business has reached saturation or maturity with their existing products and services. My Business Manager will report on individual Groups and accounts so that you can analyse the revenue and profitability of new products or services. Set up a Group or create a separate Dashboard to make analysis easy.