Little things make a difference. Increasing your conversion rate may be as simple as changing the way you answer the phone or respond to questions. Now you have clients and you want them to continually come back. Develop strategies to encourage repeat business and to increase your average dollar transaction.
If you sell something for $100, how do you increase the value so you can sell it for $105? How about $108? Or even $110?
The key is to make small incremental changes to each category to not only increase your gross revenue, but also to increase your net profitability. For example: Increase your leads by 10%. If you’re at 20% conversion, increase that to 22%. Now increase your average dollar sales from $100 to $110. Change the frequency of transactions from 2 in a year to 2.2 a year. If you make these small incremental changes, you will increase your revenue by 48%.
You can increase your profit margins in a number of ways. Negotiate with a supplier for a lower price for a product you will resell or on the parts for a product you manufacture. Maybe you are not charging enough. Identify the things that you make more money on and focus on those areas so that your overall margin can change. Say you’re working at 25% profit margin, if you get it up to a little over 27%, you will have about a 61% increase in your actual profitability.
Strategically break down the categories piece by piece so you are creating more profit that you keep. Profitability is really what it’s all about—that’s why we’re in business.