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Our mission is to provide information
and strategies to business owners and
managers for improvement in the effectiveness
of its business management so that key
objectives can be realized.
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Ted
Hofmann - Principal/Senior Consultant
John Morre - Principal/Senior Consultant
Linda Panichelli - Principal/Senior
Tax Consultant
Jim Chamberlain - Senior Consultant
CFO Plus, LLC
1450 Grant Avenue, Suite 102
Novato, CA 94945-3142 |
Toll
Free |
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866-CFO-PLUS
or 866-236-7587 |
Home Office |
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415-898-7879 |
Fax |
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415-456-9382 |
Email |
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thofmann@cfoplus.net
jmorre@cfoplus.net
lpanichelli@cfoplus.net
jchamberlain@cfoplus.net
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Website |
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www.cfoplus.net
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Many
people think growing a business is a complex
process, but it is simpler than most think.
In fact, if you’re seeking suggestions as
to what guidelines to follow here are four
that should become your guidepost.
- Increase
the number of customers (of the type
you want);
- Increase
the transaction frequency;
- Increase
the transaction or value of "average
sale"; and
- Increase
the effectiveness of each process in
your business.
Okay,
this seems easy enough. In fact, it may
appear to be too easy, but companies really
need only to focus and commit to these functions
for optimum success in the area of growth.
Increase the Number of Customers (of the
type you want) Getting
business through the door often proves to
be the most challenging and expensive aspect
of growing a company. It’s tempting to
assume that you automatically need to seek
new business without making sure you’ve
already tapped the business you have. However,
finding a brand new customer can cost significantly
more 'some experts estimate six times as
much' than working with the customers you
already have. What exactly does this mean?
You already have a customer base that is
sold on the services you provide. This
captured audience is just waiting for you.
Some of the best advertising you could ever
have is the kind that a satisfied customer
will do for you. These customers also provide
a higher chance of finding you the type
of business you want versus whatever simply
walks through the door. If your company
is business to business, ask customers for
referrals to other companies that operate
with a similar mindset. If your company
is business to consumer, engage activities
that draw new customers from your current
customer base.
Increase the Transaction Frequency
Once you have the right type of clients
(that means the kind you enjoy working with
and those who pay on time), you want to
ensure that they not only stay with you,
but increase the amount of business they
do with you. A one-time only customer may
not seem like the best one for you. Yet,
if the customer is the perfect fit in the
type of business you’re looking for, you
need only to foster the relationship. Customers
will come to you for different reasons.
They may have been told about your service
from someone else, or found you on their
own. The point is that the customer may
initiate the relationship, but it’s up to
you to nurture it and make it grow. When
you offer exceptional customer service and
let the client know how much they are appreciated,
you will create a client that returns again
and again. Increase
the Transaction Value, or 'average sale'
Business owners are often passive about
the amount they sell to a customer. However,
if a customer seeks you out, you have to
remember they are looking to you for your
expertise. Cross-selling is not only a
benefit to you, but to the customer as well.
When you bring more value to the customer
through multiple services or products you
provide them with more opportunity. In
turn, you have created a more valuable customer
relationship, which is easier and more cost-effective
than creating a new one. And, as customers
come back more frequently, their average
sale often increases. Increasing
price should also be considered, but is
sometimes difficult since clients become
accustomed to a certain cost. However,
when you are able to break down price, volume,
fixed costs and variable costs you’ll find
that increasing your cost means truly applying
the correct price to reflect the value of
the service or product you offer. Some companies
have taken a lesson from fast food restaurants,
and have started offering 'package' deals.
This pushes the customer to a higher price
point with the perception of receiving a
'discount' on the overall order. This technique
may be used in many industries.
It’s
important to keep in mind that companies
can lull into a comfy, cozy state of cost
coma. One manufacturer, for instance, had
not changed prices in 10 years. By increasing
the price of just one product, the company
increased profits 11 percent. The average
sale is a powerful growth mechanism.
Increase
the Effectiveness of Each Process in Your
Business
How many of us just jump into work and do
it? There may not necessarily be a defined
process, but who has the time to figure
out if there’s a better way of getting things
done? The truth is that the time you take
to increase your business’s efficiencies
will have a direct affect on a project’s
outcome and, ultimately, your profitability.
Business
is a group of people carrying out a series
of processes. If the processes in place
aren’t running as smoothly as possible,
you can lose a considerable amount of time
'and money ' on things such as overcompensation
for mistakes, inadvertent doubling up of
manpower, and troubleshooting problems.
Taking
the time to evaluate how business is generated,
whether or not the customer service chain
is efficient, and where time is lost in
the moving of products or delivery of services
can provide you with more information for
scrapping a system or improving on one that
is seeing a significant return on investment.
Performance
measurement is the machine that runs a well-performing
company. Contact us today to learn more
about the four ways to grow your business!.
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