More than 500 small business owners have completed the 100 Days to Abundance course. They come from all different industries, some are companies, and some are solo professionals.
Across the board, in working with these talented and innovative business people, I have identified three of the most effective opportunities for business growth.
In this post, I’m going to outline the three areas in which you can experience the most growth in your small business, and give you a look at how these play into your overall marketing strategy.
The top three strategies for growing your business
There are dozens of things that you can do to grow your small business, but when it comes to achieving rapid business growth, you absolutely must focus on a few key opportunities.
There are three areas–and only three areas–in which I’ve found that business owners can achieve the greatest growth.
- Increase your activity
- Increase your closing ratio
- Increase your average sale
Each one of these three metrics has a direct relationship on your revenue. For example, if you double your activity, you double your revenue.
Let’s break each one of these down and explore how they can help you grow your business.
1.) Increase your activity
If you are currently meeting with 10 prospects each week and, starting tomorrow, you choose to start meeting with 20 prospects each week, you would effectively double your income.
For small business owners, it is easy to start generating a little more activity. Call on more prospects, arrange more meetings, and close more sales.
But doubling your activity is difficult, especially in 100 days or less. So let’s look at another opportunity.
2.) Increase your closing ratio
Suppose that you were meeting 10 prospects per week, and out of those 10 prospects, 2 would become clients. You would have a 20% (2/10) closing ratio.
Now suppose you could double that. What if, instead of closing two clients, you closed four clients? By doubling your closing ratio, you would double your business without generating any more activity.
Again, it’s easy to slightly improve your closing ratio, but doubling your closing ratio would take extensive sales training for which most small business owners have neither the time nor the interest. So that’s out.
3.) Increase your average sale
If you stuck with the same 10 prospects, and maintained the same 20% closing ratio, but doubled the average sale of a client, you would double your revenue.
For example, if the average value of a client is $2,500 and, in a short period of time, you increased the average contract size to $5,000, your business would generate twice as much revenue as you were before.
Again, it’s very difficult to double the average value of a client in a short period of time.
Double your revenue with incremental growth
So, if it’s so hard to double any one of these metrics, how can you achieve rapid, sustainable business growth?
The secret to successfully growing your small business is not to try to double any one of these three metrics. Taken individually, each one of these is next to impossible for most small business owners to achieve in fewer than 100 days.
Instead, successful business owners double their revenue by increasing each one of these areas of their business incrementally over a period of time, over and over again.
What impact would that have on your business if you could…
- Increase activity by just 25%
- Increase closing ratio by only 33%
- Increase average sale by just 25%
By incrementally increasing all three of those variables across the board, you would increase your income by 113%.
The key takeaway here is that it doesn’t take a gargantuan effort to rapidly grow a small business. Instead, it takes a few areas of focus and a commitment to incrementally improving in each one of those areas.
In a future post, we’re going to cover a few specific examples on how to increase each one of these metrics and give you tips for implementing them in your small business.
What will you do today to grow your business?