Looking For Incremental Growth?

By: Bob Dearing, CFE 

Here we go! The holidays are in the rear-view mirror, 2020 has already made its presents known in a big way and a new national college football champion has been crowned. The pace has been set for high expectations for an exciting and rewarding new year ahead.  With the wind at our back and a healthy economy now is the time to address our growth approach and begin today to implement an incremental sales strategy to enhance our strategic plan.

What are Incremental Sales?

Let’s start with defining incremental sales. Business Dictionary offers the following definition:

“Number of units sold through a sales promotion offer in excess of the estimated number that would have been sold without it”. I would alter that definition just slightly to read. . .

The number of sales made through an expanded sales effort in excess of the estimated results that would have been made without it. In other words, performance against goals!

Sales growth does not just happen! It takes thought, dedication, process and discipline.  Watch this short video from Brian Tracy as a refresher for some things that you may or may not have considered.

What are the steps?

Tracy offers seven different suggested steps on ways to grow your business. You may already be using two, three or maybe even four, but are you using all seven. Two or three may contribute to your sales plan for the year but following all seven will add the incremental sales to put you over the top. Let’s look at the steps:

1. Increase the number of qualified leads. Generally, this is a marketing function that generates leads from direct mail, various forms of print advertising, and email. You can supplement this effort with networking, social media and personal associations or groups.
2. Increase the number of prospects you convert to buyers. One of the most important things you can accomplish. Visitors to your store or business is great however convincing them to make a purchase is crucial to your sales success. Remember, over time you will lose some customers for various reasons so you must always be adding new customers.  Conversion rate, or converting a prospect to a buying customer, is an important metric to follow closely.
3. Look at key areas in your sales process and seek ways to improve.  We live in an instant gratification world! Time, convenience and transparent pricing are benefits that are highly valued by your customer. Look for ways to streamline your order processing. Efficiencies offered by technology advances are the norm in today’s sales environment. Look for them.
4. Increase the number of individual sales. In the marketing world this is called frequency of purchase. In the sales world frequency is an outcome of two things, need and relationship. When the customer has a need for your products the relationship you and your company have developed immediately brings them to you. Never underestimate the value of relationships!
5. Increase your profit margins for each sale. Competitive pressures do not always allow “raising prices” on your product. Always competitive shop your market and compare product pricing “apples to apples” to be sure you are competitively priced. Negotiating prices on select products with your vendor to reduce your cost and increase your profitability is always an option.  
6. Lower cost of acquiring a customer. There is a cost for everything and acquiring a new customer is no exception. Marketing and advertising, association dues, direct mail are direct costs that must be paid. While there is a cost (time) in networking or prospecting by telephone (again time) there is a cost benefit when you acquire and convert a prospect from this activity. The short answer here is “prospect” more.
7. Think of ways to increase customer referrals. Remember our conversation about relationships? Satisfied customers will always recommend their friends and family to their favorite place to shop. You want to be sure you are their favorite place. Offer discount coupons to your customers for one of their future purchases for referring business to you.

Is there more?

Think of it this way. You and your customer have a lot in common. You shop where you feel safe and comfortable, employees recognize you when you come in, prices are fair and competitive, and you have developed a relationship.  How is that any different than what your customer wants when he visits with you?

Never take your customer for granted. Guard your relationships. If you deal with trade professionals be sure you provide product and installation seminars; provide appropriate and approved supplies and warranty requirements. If you are dealing with a retail customer be sure your selling atmosphere is comfortable and safe. Ask questions and provide solutions rather than just a product. Be sure they understand all the benefits of the product they are considering and not just the features.  

One last thing

Treat people the way you want to be treated and you will have a customer for life. Customer retention and customer acquisition must always be “top of mind” in your growth strategy.