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Boosting Your Profits in This Recession - Part 1

Guest post by: Holly Murdoch

Article Overview: There are two types of responses a business owner may have to this recession. One is to panic, which fills your mind with fear, doubt, worry, anxiety and bitterness. The second is to get better. If you are serious about surviving and thriving past this recession, you need to get serious about getting better in all aspects of your business. But, first things first - you need to start by knowing where exactly your business is strong and precisely where it needs reinforcement. Whether your goal is to increase your total net profits by $10,000 or by $10 Million, you need to isolate individual values that collectively contribute to that goal. Remember that performance measured is performance gained.

Boosting Your Profits in This Recession - Part 1

There are two types of responses a business owner may have to this recession.

One is to panic, which fills your mind with fear, doubt, worry, anxiety and bitterness. The second is to get better. If you are serious about surviving and thriving past this recession, you need to get serious about getting better in all aspects of your business.

But, first things first - you need to start by knowing where exactly your business is strong and precisely where it needs reinforcement. Whether your goal is to increase your total net profits by $10,000 or by $10 Million, you need to isolate individual values that collectively contribute to that goal. Remember that performance measured is performance gained. Here are three of seven areas to measure your performance:

#1. Measure your time. All of us in leadership ask at the end of the year, "Where did all the money go?'' I encourage my clients to start a habit of asking at the end of each day, "Where did all my time go?'' We all know the old adage, "Time is money." Time is the first place I ask clients to measure and evaluate. I often help clients design what their personal daily report (PDR) forms should look like based on each person's specific duties and function. On the PDR form, or even on just a notepad, each employee logs what she accomplished and how long it took them to complete each task. Once you accumulate a two to three week snapshot from everyone, you can then begin to identify not only each person's efficiency and productivity, but also their effectiveness. While efficiency is important, it is possible to be efficient at all the wrong things. Productivity is especially important to determine for key people like the president and senior managers. Remember that performance measured is performance gained. #2. Measure your marketing results. Does your company log in every prospective call, how they heard about your company, what product or service they were interested in, and their contact info? While this may sound like basic business practice, it is one that is not widely practiced by even the established companies. The person who makes the advertising choices and approves the marketing plans needs to have an accurate monthly advertising/marketing source report from which to base an effective strategy. Marketing mistakes bleed resources, and the biggest mistake decisions are made arbitrarily. Remember that performance measured is performance gained.

#3. Measure your conversion efficiency. For most industries a sale does not happen right after the first inquiry call. There is an intermediary phase that has to occur. For the caterers, they need to convert inquiry calls to appointments to sample their food. The health club industry needs to convert the first call into a compelling reason to come visit now. Service industries, whose calls are mainly from price collectors, can still create a compelling incentive to get prospective customers to sample their companies, whether it is in the form of a valuable newsletter or an educational video. The sample stage is an important phase in your sales cycle. Don't simply react to the year-end profit number without having examined how your company has performed at each phase.

Remember: Performance measured is performance gained.

Check back next week for four more tips on how to grow your profits!

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Article Tags: 10 million, anxiety, business owner, doubt, fear, net profits, profit, recession, w2wlink, worry



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