Usually, when I bring up the subject of doubling business turnover, I meet with a lot of resistance from business owners who claim it’s either not possible or believe it takes a long time.
Most of us are generally challenged a little bit when we think about doubling our business turnover. We have an internal resistance and believe a lot needs to happen in order to double turnover, when in fact it can be really simple.
In this blog, I’m going to show you exactly how you can double your business in the next 12 months or even less if you implement what I’m about to reveal.
Exponential Gains through Incremental Changes
Let’s say we have a business where we fulfill 100 orders per week and the price of the item is $20. Let’s assume the average buyer makes one purchase a year and that 10% of these customers refer one other person who also makes a purchase.
Assume we are able to increase our orders by 15% and also the number of repeat purchases by another 15% through our marketing efforts. We also raise prices by 15%, from $20 to $23. The result is that the revenue of the business goes up by about 50%.
Now let’s take this a step further. Say you introduce a new product, one which is complementary to the one your customer has already bought. You’re right if you’re thinking this is similar to what McDonald’s does by asking, “Would you like fries with that?” They make another offer at the time of purchase.
Depending on what industry you’re in, how good your offer is and how congruent it is with the first offer, about 25 – 40% of the people will purchase the second product on the spot if you offer it to them in the correct way.
So let’s say 25% of the people buy the second product which is also priced at $23. The overall sales begin to climb appreciably. Let’s say the referrals increase from 10% to 20%.
If you look at the revenue figures now, you will see they have doubled from what they were originally.
What I’ve just demonstrated is that instead of trying doubling the whole business all at once, all we’ve done is broken it down into individual components, so we can tackle these one by one. Using this strategy, you can double your business turnover in a very short period of time.
Leveraging Price and Product for Immediate Returns
There are two important things that need to be pointed out here.
The first is that price is the easiest variable to change for doubling your business turnover. Many business people are resistant to increasing the price, for the fear of turning customers away. The reality is that most customers will stay with you when you increase your price, as long as you give a valid reason for the price increase.
I’m not asking you to just double your prices. Far from it.
Let’s say for example, the original product you priced at $20 is being sold at a 100% markup, with the product costing $10. Say you increase the price of the second product that you added, by just $3, so it’s now priced at $23.
That’s not much of a difference to the buyer. However, it represents an increase of 30% to your bottom line. You have achieved an instant 30% profit through a15% price increase.
So far you’ve only added one new product. There’s nothing stopping you from adding two, three or more products which the buyer could consider at the time of purchase.
As you can see, by implementing what I’ve shown you, it’s quite simple to double your business turnover, without working longer hours.
What I’ve shown you is just one approach you can take to doubling your business turnover. There are a few others which are equally effective as well. A little outside-of-the-box thinking will help you uncover these in your business.
If you found this information useful and would like to explore other ways to double your business turnover without working longer hours, please free to contact me and together we’ll explore the most appropriate approach to help you achieve your business goals faster.