Categories
Planning & Management

How to Accelerate Your Company’s Product Line Growth and Stop the Continual Decline in Profitability

Article Contributed By Bill Bachrach

The management team cannot believe that their company’s profitability continues to decline at a consistent rate, quarter after quarter. “How can this be?” says the Chief Marketing Officer. “Five of our customers have named the company supplier of the year! The crystal bowls and the plaques with our name on it are displayed in the front lobby.”

Most C-Suite executives are very proud of their awards, yet they have difficulty understanding why profitability continues to decrease. As a consequence, the executive team focuses its efforts on minimizing their internal cost structure. But these efforts do not seem to be enough to turn the company’s profitability around.

Instead, executives need to know how to break a spiraling downward financial situation and forge a new path that will accelerate growth and profitability. To do this you need to understand:

  • The forces affecting the profitability of the product line
  • Your true profitability drivers
  • How to create a pathway to accelerating growth

What Forces Affect Your Product Line Profitability?

The ability to make money comes down to what the customer is willing to pay for your product relative to their needs and competing products. One method to determine the value of the product is to use a Product Line Profitability model, which looks at the difference between the product sales and the production and operating costs. In this model, the product sales are dependent on the markets and regions where the products are sold including their past and future sales projections. The product production costs and operating expenses are comprised of a number of costs including material costs, labor costs, support costs, and capital equipment costs.

The Product Line Profitability model provides the building blocks for identifying the business’s strengths and weaknesses as it relates to the profitability drivers. A product line check-up is good practice to understand how the internal and external forces are changing your business.

Now, the Product Line Profitability model provides the executives with the tools to analyze the organization’s cost structure today and to begin developing a landscape for profitability. But the model itself is not enough to truly get at what are the underlying drivers to accelerate profitability and to understand what needs to be leverages for growth

What Are Your True Profitability Drivers?

Identifying and understanding the influence of the internal and external forces that drive the acceleration of growth must include the analysis of these five areas:

1) Sales channel profitability
2) Product line price fluctuation
3) Product line material and labor cost
4) Organizational efficiency
5) Product line development time and traction.

A typical development during a product’s life cycle is the entry of a competitor’s product line in the market with similar form, fit, and function that now competes against your product. What happens now? Everything is decreased – your product line price and profitability, your sales channel profitability and your organizational efficiency. The product line material costs may need to be decreased and the product line may need to be re-designed.

Your profitability drivers vary depending on the product, market, and industry. But once you uncover these driver, you will be able to pinpoint the business and organizational issues that need to be dealt with first as you develop a business growth acceleration game plan for your product lines.

How to Create a Pathway to Accelerating Growth

As your executives reviews the profitability drivers as well as the internal and external forces for each product line, a picture will emerge on the strengths and weaknesses of the business and organization. Analysis should also include changes that concentrate on making money for the business as opposed to whether or not a product or customer will be eliminated. This picture, then, becomes the basis for unifying the company’s business strategy and the day-to-day game plan for execution to make money.

A map then needs to be drawn step-by-step to ensure the company’s growth is on an accelerated path to growth. However, this pathway to accelerating growth does not happen instantaneously. It evolves over a period of time with direction, leadership, focus, dedication, and discipline. Most importantly, everyone (from the CEO on down) must embrace the chosen pathway, as they will need to execute it.

Follow these tips and you will accelerate the growth of your company’s wealth and value. This is the same approach that I took as a C-level executive to guide companies in electronics, manufacturing and high-technology industries to higher profits and significant returns for owners and investors.

About the Author:

Revenue and Profit Growth Expert, Bill Bachrach, has led numerous companies in various C-Level positions and works with Boards of Directors and Investors who want to accelerate their company’s wealth and market value. His firm has developed a 5 Step Model for Profitability that quickly creates a pathway for improved revenues and rapid market expansion. To learn more about this model and uncover the #1 secret to building momentum for growth and profitability, check out Bill’s free articles at: http://www.linkedin.com/in/billbachrach01

Categories
Customer Service

Using Social Media to Enhance Customer Relations

Article Contributed by Jennifer Couch

Social media has given companies a powerful tool – the ability to see real-time online conversations about their brands. To be successful, companies must remain proactive and constantly search for conversations; though someone may not be talking directly to the company, they may be talking about the company, which is just as important.

Finding the Conversations

First and foremost, companies must search for conversations. Google provides services that allow companies to search for keywords in real time. By utilizing Google’s “Discussions” tab, companies can search for their name and find conversations on forums relating to their company. Customer service representatives can then intervene and work to solve the problem.

Google also offers a search feature called “Realtime” which searches for keywords in micro blogs such as Twitter. This gives customer service representatives an opportunity to see what “Tweets” are being shared about the company.

Blogging is also another way customers express their frustrations online. Blogs also allow people to comment which can be another source of conversation about your brand. Using Google’s “Blog” tool allows companies to search for blogs and comments that include content about their company.

Video and photo sharing sites also need to be monitored as they allow comments that can include information about the company.

Being Accessible Online

Companies must make it possible for customers to find their social network contact information. Information on social networks should be displayed on the company website, company emails, and marketing materials; publicize that customer service representatives are available on all of your social networks.

When a problem arises:

When companies discover a negative conversation or comment, they must not be ignored. Facebook pages should be constantly monitored and comments of negative connotation or concern should be addressed immediately. Quick response time, a personal approach, and follow-up are imperative when handling customer service issues online.
Best practices state that a negative Facebook comment’s reply should say: “We are sorry to hear about your bad experience and would like to speak with you personally to get the problem resolved…”

Charter Communications does an excellent job of reaching out to customers and identifying problems through Twitter. Their customer service representatives monitor Twitter for any sign of conversation about Charter, and if a problem arises, they contact the person directly and work to get the problem resolved as quickly as possible.

Many businesses are becoming successful at using social media for customer service issues because they remain proactive in their search for queries, comments, complaints, and conversations relating to the company. In some cases, this can help diffuse a problem before it arises.

Monitoring conversations online will allow companies to gain useful first-hand knowledge and help to deliver a service that is more satisfying to customers in the future.

About the Author

Jennifer Couch writes for Auctori.com. At Auctori.com learn more about implementing a social media strategy in your company.

Categories
Customer Service

Adopt a People-Centric Approach to Improve Customer Satisfaction and Profitability

Article Contributed by Sara LaForest and Tony Kubica

Does a leader need to be the smartest person in the company to achieve growth and customer satisfaction? No.

In fact, being the smartest person in the company can actually impede growth. Some leaders just can’t get over “themselves.” Yet unfortunately when you suggest that they could be the problem, it’s often met with one of the following responses:

  • Confusion (i.e. you talking to me?)
  • Dismissive (i.e. you have no idea what you’re talking about)
  • Shock (i.e. how dare you talk to me that way)
  • Anger (i.e. you’re out of here)

After all, they are the smartest person in the company. They know the problems, they know what needs to be done, and they will do it.

We have a (perhaps unwelcome) secret to share…

No one is that smart. No one can do it all exceptionally alone (at least for long.) And talented employees want to contribute and show their talent.

The greatest risk in this self-delusional thinking is that your brightest employees will actually be the ones that bring you out of the recession stronger. Limit their chance to do so– dim their opportunity– and your great employees will leave, with the remaining employees just doing just what they are told, and the replacement employees will be less talented.

Whom does this adversely affect outside of the leader and your employees? Your customer.  Who benefits? Your competition!

It is essential for leaders to understand that customer service is the lifeblood of their business. (Yes we are aware that cash is king and without positive cash flow the business ceases to exist. Without satisfied customers, however there is no cash. And without satisfied and engaged employees there are no customers – satisfied or not!) So let’s see take a critical look at what the most successful corporations, organizations

and companies are doing different.

Why Nordstrom, Zappos, Apple and Netflix Ranks High in Customer Satisfaction.

Are the companies listed above perfect? Of course not. Are they serious competitors? Absolutely. How are they differentiating their customer service from others in their industry? They are using an employee-centric approach to heighten their customer service. The premise of “The Service-Profit Chain” (first developed at Harvard University by James L Heskett) speaks to this approach. It’s premise is simple: highly satisfied customers drive growth and profitability, and highly equipped and satisfied employees will better satisfy customers to drive that growth. Otherwise said, employees with the skills and power to really serve their customer have an increased employee satisfaction, productivity and loyalty which in turn leads directly to increased service to the customer, meaning greater customer satisfaction and loyalty, which of course, leads to greater revenue. Most simply stated, satisfied employees are a critical contributor to customer satisfaction!

We see this as an employee driven profit model – and it’s “people centric”, which to us is the heart of your business.

Results Our Clients Are Achieving Using A People-Centric Model

One healthcare software consulting company survived the recession relatively unscathed. Another grew over 38% percent during the heart of the recession. How? By providing personalized and highly focused customer service.

As small businesses re-surface post-recession and look to differentiate themselves and grow, improving customer service through a people-centric approach will be an important strategy to adopt.

So, when leaders start to think about growth- they should start first with their customers and how to provide value, and realize that it’s their employees that are the golden egg. Then the conclusion is inescapable: prepare and support your employees to provide outstanding service and your customers will reward your efforts.

About the Authors:

Sara LaForest and Tony Kubica are management consultants with more than 50+ years of combined experience in helping organizations improve their business performance. They say, failing to adopt a people-centic approach to increase customer satisfaction is just one way to sabotage your business growth. Get their complete “Self-Sabotage in Business White Paper” now at: http://www.kubicalaforestconsulting.com/report.php

Categories
Business Ideas

3 Keys To Attracting Leads, Clients and Sales to You Effortlessly

It sounds magical, doesn’t it? Attracting leads, clients and sales to you effortlessly. In fact, it almost doesn’t sound possible.

But the truth is, it IS possible, even if it isn’t magic. It’s all about good, solid marketing principles. And if you follow the below 3 keys, you’ll be well on your way to experiencing that for yourself in your business.

1. Create a powerful message that appeals to your ideal clients. This could also be thought of as your Unique Selling Proposition (or USP).

So what exactly is that? Basically it’s the solution you provide presented from your ideal client’s viewpoint. So, for example, let’s say you’re a business coach. Well, those are a dime a dozen. Instead, what if you specialize in helping women entrepreneurs get over their blocks to making more money in their business. See how more powerful that is? And how it can magnetically attract your ideal clients to you?

Or let’s say you’re a fitness and nutrition expert. Yawn. But what if you specialize in helping women with hormonal issues lose weight. Ah, much more powerful.

In addition to attracting your ideal clients to you, you’ll also notice these also position yourself as an expert. After all, if you have such a specialty, then you must be an expert. And of course, people would much rather do business with experts.

2. Be consistent with your message. Once you know what your message is (and you’ve tested it so you know it attracts your ideal clients) now you need to get it out into the world. Resist the urge to be creative about it.

I know, I know. You get tired of saying it. You’re sure other people must be tired of hearing it. But if you’re not consistent, if you tweak a little here, a little there, maybe edit it here, you’re not getting the full power of it out there.

Look, even you’re most loyal clients aren’t going to get sick of hearing your message. Why? Because they really don’t “hear” it as much as you think they do. People are busy with their own lives and they really aren’t paying as much attention to you as you think they are. So if you don’t repeat it and repeat it consistently, then you run the risk of people not remembering what you stand for, or maybe being confused about it, and if they don’t remember or are confused, they’re not going to invest with you or recommend you or anything else.

3. Be frequent with your message. You’re going to feel like a broken record, but the best marketers are the ones who have a simple, powerful message, are consistent with that message and repeat it over and over again.

And don’t just repeat it in the same places, find different ones. Get your message out there in as many ways as you possibly can. (Just as long as those places are where your ideal clients hang out.) Online. Offline. Networking events. Speeches. Podcasts. Etc.

In fact, here’s the place where you can be creative. Find new and different ways of getting your message out there, and do it as frequently as possible. Because the more often your ideal clients stumble across your message, the more likely it is when they’re ready to make a change, they’ll reach out to see how you can help them.

Categories
Entrepreneurs

Tips for Small Business Owners

Article Contributed by Dexter Siglin

For anyone in sales, winning the favor of the C-Level executive you’re pitching is the Holy Grail in sealing the deal. Everyone has a story of the months – and sometimes, years – they spent trying to get a foot in the door at a client’s company. And everyone has at least one tale of the heartache of finally making contact with a C-Level, only to be shut down. Aside from praying for divine intervention, what can small business owners do to establish good connections with their C-Levels prospects?

1) Establish Credibility

Build your credibility by assuming nothing and working for everything. Don’t make the mistake of thinking that because your company has credibility, that it automatically rolls over to you in the eyes of a prospective C-level client. One step further – don’t make the mistake of ‘assuming’ that your company has credibility! Be willing to start from scratch with a C-level prospect: don’t ignore the C-level’s staff by going around them. And you know what they say about “assuming”…. don’t assume that because they spend money with your company they like you, and don’t assume because you had one o.k. meeting that you can ‘friend’ them on Facebook.

2) Don’t be desperate – Be different

The best piece of dating advice I ever received from my father; “Son, there is no bigger turn off to a woman than a man who acts desperate.” This advice can also be applied to the sales dynamic in working toward the C-level executive. People that act desperate to get a ‘lunch date’ or to give away concert tickets – just to get face time in the ‘courting’ stage, come off as having no value except that which they can buy in the form of entertainment. Most C-levels see this all the time and are numb to it. Save those trinkets for when you already have a good relationship and can use to build on and expand it.

3) Net-work it

It amazes me when I talk to sales professionals who’ve been in the business for several years, yet have no solid professional turned ‘friendly’ executive relationships. By friendly, I mean the kind that you can call on their mobile anytime to talk about football and business. If you want to build long-term credibility and value, relationships need to be fostered and developed over time so you have a ‘network’ to rely on when you need it. Go to events, attend calls that execs might be on, add value without being annoying. Sometimes the most impressive people are the one’s that can show they ‘listened’ instead of talked too much. Once you make a connection – add them to your network (see #4 below) immediately and foster them over time by giving more than taking.

4) Social Media

When I was a sales leader looking to hire a sales professional, the first thing I looked at was a candidates LinkedIn profile. I was always dumbfounded when I saw someone who purported to be a ‘people person’ and yet have 50 ‘connections’ on LinkedIn (that’s a D in my book), and no Twitter account (grade F). For most industries, if you are in sales and trying to expand your prospect network and not in the social media game – you are playing in the minors. Using my social network – within minutes, I can provide value to person in my network just by connecting them with another in my online posse – or a friends network – and it takes not time at all (once you have the network that is).

5) Add value

Adding value is not ‘volunteering’ your latest white paper or spamming your LinkedIn network with irrelevant updates and webinars your company is holding. True value is offering an idea or a resource when it’s needed, and asking for nothing in return. Example – when you find out that a C level is looking for something – could be a resource to hire, advice on technology, etc…go get it for them in your own network – make the connection, and go away! The beauty is, if you do this enough,
eventually you become a colleague with professional value – not just a ‘taker’.

About the Author

Dexter Siglin is the community manager of xPeerient.com, the world’s first social IT exchange, who’s mission is to “create a world without cold calls.”