30th June is around the corner and owners are starting to turn your minds to FY 19 forecasts. If growing sales by 10% + is important, before you set such goals, ask yourself “are your business goals making an impact?”.
I see many business owners taking a look at the last 12 months, and saying “I need to do better”. So we increase our last years sales by at least 3-5%, perhaps we set our sales target at 10%+. Then we review our COGS, our overheads, and move our minimum wage up 3.5%. Now we have a new profit target. But how do you ensure your strategies will grow your business to hit the new profit target.
Well, a great way to start is to ask yourself about “the impact” of the new business goal.
- What does the outcome look like – what are the building blocks that sit below the outcome.
- What needs to move or change. How many times, or by how much more (or less).
- To be successful, what needs to be true? Can you describe it. Being true means that a set of facts or circumstances must have happened.
- Business goals require timeframes. To move you business forward tomorrow, you need to be taking actions today.
- And what is the impact (in $ and cash terms) if the business goal is not reached.
Let’s take sales revenue. To grow your revenue by 10%+ what needs to be true. There are a number of answers and the strategies you choose will either make a bigger or quicker impact, in a shorter time, or are your strategies longer term ones where you target a specific business/customer/segment that is new to your business.
We know that competing on price is a difficult cash equation to manage. You potentially undersell the value within your business and services, and your industry may well price match what you do. If you are price matched, reducing your price only delivers lower profits, not revenue growth.
Business coaching teaches you how to better understand your best customers, and how to get more of them. Growing more of your best customers perhaps takes a little longer, but they tend to be loyal (more repeat business), more likely to provide referrals for you, generally provide a bigger gross profit margin, and probably requires less support and maintenance than dealing with multiple smaller customers.
Business coaching can also show you the value in your service/product and how customers relate to these. Sometimes we are too busy selling our features and benefits (facts), but we forget to ask what do our customers really value. If we can move the buying process away from fact (feature and benefits) to what is the impact for my customer from buying my product/service (emotional connection), then the answer lies in the emotional reasons that sit behind a decision to buy.
We tend to forget that the impact of a decision is not a financial plus or minus equation, it has a strategy behind it that is purpose built to make an impact. If the strategy does not make an impact, then the financial business goal becomes an irrelevant number.
Impact means engagement, so there is more buy in by default. But if the impact is real, then your team is likely to be more committed. And committed teams grow business profits 3 times quicker than your competitors.
As a Melbourne Business Coach I mentor and challenge business owners to unlock six figures and beyond in your business – I am very clear about my impact for you – not only to run a better business with at least $100,000 more profit, but so it positively impacts the lives of your family, your staff and your community.