Do You Remember When You Learned to Drive?
You had to perform multiple tasks often simultaneously – look ahead, check the rear and side mirrors, maintain a light foot on the accelerator pedal always be ready to switch to the brake, firmly hold the steering wheel and well, you get the picture.
Driving your business is very similar to driving a car. For expediency, let’s skip over the obvious and talk about your key performance indicators (KPI) or your dashboard. Just like your car, the business dashboard is a series of vital operating measurements. You’re already tracking sales, profits, and cash flow, so you know how fast or slow you’re traveling and how much fuel is in the tank.
We’ll discuss two KPIs related to customer acquisition and development.
KPI # 1 – How many customers do you have this year? How many are new?
Developing and maintaining existing customers, while adding new ones, is key to solid growth. You will lose a customer now and then for whatever reason. Losing or churning large numbers of customers destabilizes growth. Why do you lose customers? Ask the customer and the salesperson for the reason(s).
Would you like more customers like the ones you have. Ask your customers for the names of other businesses that you can help. When reaching out to those leads always, let them know who made the referral. Always close the communications loop with your original customer with a quick thank you and status of that meeting.
A healthy business aggressively grows its customer base while growing the sales potential of all its customers.
KPI # 2 – Key account growth strategies to increase sales.
You want customers to buy more from you, rather than from competitors. It is assumed that you have complementary products that bring value to the customer for one-stop shopping convenience, rather than multiple suppliers. If you don’t have products at this moment, we’ll discuss new product strategies in a future communication.
An annual business review with each major (key account) customer is recommended. Generally, 80% of sales are generated by 20% of the customers. Prior to scheduling the customer meeting, you and your sales manager should review the history of the client’s activities i.e. - items purchased, returns, timing/frequency of the orders, terms and conditions, satisfaction levels, what are they buying from competitors that you already sell, etc. From there, you’ll create a game plan for your client business review meeting.
Customers love you when you save them money and make their life easier. You are providing an overview of their transactions with you and presenting recommendations for mutually beneficial solutions.
Pilots are taught to trust their instruments to navigate and fly at safe altitudes, rather than instinct. Don’t trust your instincts to navigate your business. If you don’t have a dashboard, create one now and hold yourself accountable.