the impact of sales promotion on organizational profitability
the impact of sales promotion on organizational profitability
So welcome back to this series of improving profits. On the previous videos, we covered the idea that profits is a result and hence combi managed specifically. We also, took a look at expenses and in the last video we went deeper into expenses to understand the nature of expenses and how they need to be looked at in a slightly different way to just how can we cut expenses right.
So be careful on the quality of expenses. Be careful on what you caught and how far you cut, because that can impact on this next thing we're going to be talking about, which is sales. Now sales is as complicated, if not more so than expenses. And why is that? It's because sales, again, is a result of a whole series of processes.
the impact of sales promotion on organizational profitability
Let's look at the makeup of sales. Now, one of the mentions I had very early on in my introduction to improving sales in my business. And one of the cool things about learning stuff, and I love learning stuff, is that I use it not only for my business. I proved the principles in my business, but I then share it with my clients, right?
But one of the things, my mentor Jay Abraham. He's a, he's an amazing, sales consultant. If you like or business consultant in the U S and I learned so much from him and I owe him a lot. He talked about the makeup of sales, and he said, look, you know, you can look at the number of plans you've currently got.
the impact of sales promotion on organizational profitability
You can look at how many clients you acquire, which is again, is a function of how many leads you get. And how well you convert those leads. So there's another little complication, right? We then look at the conversion. When you look at your company, you convert, what price do you convert it? And that's a really a powerful determinants of sales, which is often missed.
We'll talk about that. Not completely separate video cause that that is worth its own weight and goal. And then of course, how many clients you lose. Okay. So how many clients do you retain? So if you lose clients, and obviously those sales aren't available for you, right? So we have these components and you can begin to see now you can begin to start controlling how many leads you get.
the impact of sales promotion on organizational profitability
Right? You can't control yourselves, but you can control how many leads you get. You can control your conversion rate. You can do things to improve your conversion rate. You can set up systems, processes. You can train, you can develop, you can learn, right? Then you have the process of. How many clients you lose, what is your client service now?
I have been in the last couple of months, I've bought a few hundred thousand pounds worth of services and some of the companies I bought them for from will never get my business again. Some will definitely get my business again. And what makes the difference is the customer service is how I was treated in the quality of the work.
the impact of sales promotion on organizational profitability
Now, some of them, they may have quoted too low to give me a really good quality service, but whose fault is that? It's not my fault. They're the ones who quoted for it if they didn't quote with enough to do the work properly and give me a great customer experience. They are now going to miss out because I'm not a customer for life.
I'm not going to be a repeat customer and I'm certainly not going to refer them. One of our principle sources of growth is our referrals we get from clients because clients love what we do for them and anyone else can you recommend someone, they will always recommend us. Because we do so much for them.
It was so responsive and we're so proactive. We help them before they all need to be helped. And that is in essence, the value, right? And so are you of that nature. So you can begin to control that, but you can't control that which is coming to pricing in the wild. You can't control that if you're pricing too low, if you haven't got the money, if you're using all the money to pay your expenses in yourself and to provide for your livelihood.
the impact of sales promotion on organizational profitability
Then you have them go, got the money to give great service, and you might be wondering, I wonder why. You know, my sales on going, Whoa, I wonder why my profits are still the same. And you begin to start picking it. I, I don't know. I don't know if your mom ever did knit knitting, but my mom used to do knitting a lot and sometimes we were given the chore of her to not, or untwist a ball of wool that has all fallen apart.
And we had to sort of sit there and she was on wine, this wall around to, to unlimited, you know, unpick the bits in it that needed to be on Pixus you could use the wool again to knit a another score for us or another jumper for us or whatever else. And so that it, that is the sort of nature we we need to do when we look at, you know, why is our business profits not increasing?
the impact of sales promotion on organizational profitability
We need to go deep, but just go, well, let's increase, let's look at increase our profits. Let's try to work harder. We'll talk about that in another, in another video too, because increasing profits, you begin now to see it is reasonably complex. And, but it's not that, you know, simple but complex and that you can't just do one thing and everything will change.
Well, you probably could do one thing or two. We'll talk about that soon. But you know, you begin to look at how many leads you get, how, you know, what are the quality of the leads you get? Are you improving the quality of the leads? You're just getting rubbish leads. You're going to spend a whole lot of time with tie kickers.
Trying to weed out the people who really want and can use your service and value what you do. For example, you know, we've got a clients who just want us forward to, to prepare the accounts with thought and forethought and care and get them minimize their tax. And they just, they just want that and that's fine.
the impact of sales promotion on organizational profitability
They get that on a, on a. On a budget and they get all the clients of you. Look, I want your help in understanding my numbers. I want my numbers story. I want to know what's happening in my business from month to month. I need to know when things are going wrong and I need to know what I need to do to make them better.
I need to know what, how to fix problems. I need to NICUs. Honestly, any problem I've had, somebody else has already had already fixed them. I just learned from them how to fix them. Any problem you've had, chances are somebody else has had that problem and has fixed it. So you've just got to look for the people who fix the problem and have, I've got the solution for you.
Otherwise you get, you'd go to trial and error and it costs a lot of money and it costs a load of time and often we don't have that time so. There is a couple of, a couple of principles there, right? So get into the expenses. Um, get into the sales, get into the nitty gritty of your leads, into your conversion rates, into your pricing.
We'll talk about that next and into your customer retention. And each of those is, you know, is covered in my, in my program. But I want you to, I want you to get as much value from this. And if you wanted to have a strategy session with me, it's completely free. It's 45 minutes where we look at where you want to go.
the impact of sales promotion on organizational profitability
We look at the challenges you're facing and we look and then begin to. Potter plot a path and a plan. Create a plan, a simple plan that you know what to do in the next 30 days to improve your business. You know, we want to keep it as simple. If we give you anything too much in too complicated it doesn't work.
You've got enough on your plate. We just give you one thing to work on. One thing to focus on that we've agreed between us that is important to do for your business because you've looked at it. With us. We've taken it apart, found the knots, and now we're on to untangling the knots. So this is going to sell though.
Wish you well. If you want to book a strategy session just to get a message to me with PP, a SS, profit, propeller strategy sessions, completely free. 45 minutes, no big sales pitch. It's really degreed value for you. If you want to help, you can ask. If you don't take the plan away and go and execute it. This is Gordon signing off an hour.
the impact of sales promotion on organizational profitability
Don't forget, help is there if you need it everywhere, right? Targeted help is available. Be aware of the complexities of increasing profits. Now you're more aware than you may have been, or maybe it's brought it back to your attention that you can't just go on and increase profits. You've got to now look at the bits of it that make it up or like, this is a golden wish.
You well, take care. Speak to you soon. Bye. Bye.
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