If you have failed at SALES; you have failed at Business.
Mastering sales is a non-negotiable for any business owner who wants to keep his/her doors open, however, many business owners simply fail because of one thing: They do not Know their Numbers…
Knowing your numbers means understanding the financials of your business, it means having an understanding of money and how money works. You cannot master something that you know and understand. Therefore, the first priority for a business owner who wants to increase his/her sales is to know and understand how money works and to master money by applying principles that will help them to earn, preserve and grow their money.
It is important for an entrepreneur to know that they do not need an accounting degree to understand their business finances. Many entrepreneurs do not invest in the knowledge they need to have because they are intimidated by it. Understanding your business finances does not have to be intimidating. One question I always like to ask entrepreneurs is this: How does one increase their sales? Most say by selling more products. That’s the typical answer a business owner would give, however like with most things that guarantee success, there is a formula that can help and sales is no different, there is a formula to sales success and that formula states the following:
Leads x Conversion= Customers
Customers x # number of transactions x Average sales= Revenue
And as you know; once you have your revenue, you can then go on and calculate your profits and ultimately, all business owners care about profit. But before applying the formula, a business owner needs to ask themselves questions to assess their knowledge about their own business:
• Is the business profitable?
• How much cash I have to buy inventory?
• How much do I owe for the quarterly income tax payments?
• How much have I collected in sales tax and when is it due?
• Is my business compliant: sales tax, state filing, notices, VAT?
• Is the business growing and at what rate?
• What is the velocity of my top products?
• Am I sure I know how to read a balance sheet?
If you are not sure of any of these, guess what: they can be learned. Meaning, you as the business owner can equip yourself with the knowledge needed to increase your sales and build a profitable business.
A small business or SMME, may not be able to afford a tax practitioner, however the owner can afford to buy credible books, attend EBL Masterclasses and free ActionCOACH sessions and empower themselves with the right information. The first step is to learn: a business only grows to the level of your incompetence. If you want to build a business that fails then that is your prerogative, but if you want to increase your sales, increase your profits and experience business success, then you need to build your competency so that you can build your business and that cannot happen unless you learn. Increase your learning so you can increase your earning!
ActionCOACH Thabo Pitse