Make More Money in Your Business

The Way to Wealth *

...Finally! A business tool you can use....

Can a business increase sales 10%, keep expenses constant and still see a 61% increase in profits?

It can if it looks at increasing the bottom-line in a systematic way. This came up with a client the other day, and I think you'll like this "what would a business coach show me" insight.

In this approach, each variable gets multiplied - for extraordinary results.

When you utilize the “Way to Wealth” all business is driven by five key profit generating areas: Lead Generation, Conversion Rate, Average Dollar Sale, Average Number of Transactions and Profit Margins. These areas are highlighted in the following equation:

Marketing Leads x Conversion Rate = Customers
Customers x Average Dollar Sale x Sales Per Period = Revenue
Revenue x Gross Margins = Gross Profits
Gross Profits x Net Margins = Net Profits

A closer look at each of these variables reveals how an increase in any or all of them can increase sales and profits, while keeping expenses constant.

Understanding Lead Generation, Conversion Rates and Average Dollar Amounts
In today’s highly competitive business world, it is not possible for business owners to sit back and see the profits roll in....unless you are strategic and tactical!

It becomes vital for businesses to test and measure everything. A good place to start is lead generation. This is defined as the total number of potential buyers that a particular business contacted or that contacted the business last year. Leads are also known as “potentials” or “prospects.” With an effective ‘Marketing Parthenon you can create strategies that are Tested and Measured to increase the numbers in this category.

Most people confuse responses, or the number of potential buyers, with results. The sound of ringing phones does not mean that the cash registers are ringing as well. This is highlighted by conversion rate, or the percentage of people that did buy versus those who could have bought. An example of this is 10 people walking through a store with three people buying something. For the day, the shop had a conversion rate of 3 out of 10, or 30%.

The next part of the “Way to Wealth,” is the number of customers. This is the number of different customers a business deals with, and it can be determined by multiplying the total number of leads by its conversion rate.

Average number of transactions is the number of purchases the average customer will make over the course of a year. It helps to keep a database of past customers, and many business owners make the mistake of subscribing to the myth of “once a customer, always a customer.” The average number of transactions is closely related to the average sale of each purchase, which is also forecast over the course of a year.

Discovering Revenues and Working on Margins
The next important concept in the model is revenue, which is computed by multiplying the total number of customers by the number of times that they bought, multiplied by the average amount they spent.

The resulting number is “revenue,” or the total amount value of overall sales for a business.
This figure leads to the concept of margin, which is the profit percentage of each and every sale. Simply put, if a business sells something for $100, and $25 was profit, the profit margin is 25%.
The final step takes the resulting revenue number and multiplies it by a company’s profit margin percentage to reach bottom-line profit.

The innovative idea around the “Way to Wealth,” is that businesses can leverage the concept even if they have a product or service with a long-term buying cycle or a limited number of transactions.

In those cases, a business could work with the other variables to improve bottom-line profit, including boosting its marketing efforts to capture more qualified leads, finding ways to increase conversion rate to customers, raising prices to leverage average amount sale or upgrading profit margins.

By stepping outside the conventional accounting perspective of profit, and recognizing that a number of additional variables drive the bottom-line – you can get a new perspective on business, and equips yourself with the tools that positively impact each variable of the equation.

This article was written by Phil Gilkes , a leading FocalPoint Business Coach. Click here to contact him.

*Ref:
The Way to Wealth, parts 1, 2, 3, Brian Tracy, all editions
FocalPoint Coaching System, Brian Tracy & Campbell Fraser, 2004

Business Coach Tip Brian Tracy

Business Coach Tip # 72 B v3.7a
…Heck of a title , isn’t it?

Well, this is one of many, many strategies professional business coaches use with business leaders.

Have you ever thought of the power certain words have on your life? Take, for instance, the word “zero”. Who wants to be a “zero”, really? I think most of us would prefer to be seen as “tens”! I want to talk today, though, about how the word “zero” can be the most important one you add to your success-building vocabulary this year.

If you’ve been following the blog, you know our business coaching principles are based on Focal Point, Brian Tracy’s incredibly successful book on how to achieve success. ( If you'd like a free copy of this as an e-book, contact me at drubino "AT" focalpointcoaching.com )In that book, Brian talks about a concept he calls “zero-based thinking”. Before we move on, think about the images that phrase, “zero-based thinking” conjure up in your mind. “Ground Zero”, “zero possibilities” and “all the way back to zero” are responses our business coaching clients have given. Those seem like pretty negative concepts, don’t they? Well hold on, because I’m going to show you how “zero-based thinking” is an incredibly powerful, positive step in building your future success.

Here’s how Brian defines the concept: “Is there anything that I am doing right now that, knowing what I now know, I wouldn’t get into again, if I was starting over today?” In other words, what business relationships, product lines or sales strategies have proven over time to have a negative impact on your success? When you really zero in on your daily activities, what’s hurting more than helping? Where are you spending your time with zero return on that investment?

Now, apply those same questions to the team you’re supervising. What are you doing, individually and as a team, which is actually unproductive? It’s going to surprise you how much time you’re spending on things that have a negative effect on your ability to succeed! We all fall into this trap; it’s sometimes easier to form negative habits (keep selling the same old product line, keep meeting with contacts who bring no benefit) than it is to turn our energies toward the things that will bring greater success.

Going through this process helps you “zero in” on the things that are draining the energy out of you and your team. Can you see how powerful “zero-based thinking” could be in moving you toward success?

Finding the answers to those questions, and helping clients discover ways to remove those unproductive things from their business strategy is exactly what business coaches do. I’d like to hear your feedback on this concept! Talk to me about what you might need to remove from your life. I’ve got some great strategies for you, when you’re ready to ask the hard questions.

Steve Thompson, President,
FocalPoint Coaching, powered by Brian Tracy

Business Coaching’s Secret Formula : The “Grand SLAM” of Business

Business Coaching’s Secret Formula : The “Grand SLAM” of Business

Here’s a story from the field that’s not uncommon, but just surfaced again earlier this week. Like the common cold, this story comes and goes, with hot spots throughout the country here and there at any given time.

One of our coaches had just started with a new client ( retail optical, Wisconsin). He and his team had been working too many hours with little visible results, and he wondered if it was time to hire a new team. He had even gone so far as to have a plan for re-starting his entire team from scratch. It was sketched out , and he was going to discuss it with his coach at that weeks coaching session.

Hold Everything! Here’s what he was asked: before you fire your team, is there a better way? The coach, referring back to the coaching system, worked with the owner to get Clarity on this point. ( For your reference, see the Grand Slam Formula found in Brian Tracy’s Focal Point . To email me for the free e-book, just send a request to us at drubino “AT” focalpointcoaching.com)

When he hesitated, we asked him another question: did he, himself, want to continue spending too much time at work, no matter who he hired for his team? You see, we’ve learned as business coaches that managers with the wrong focus tend to create teams with the wrong focus, and see the same results over and over.

That question pulled him up short and made him realize we might be onto something. Once he agreed, we began to explain the Focal Point Grand Slam Formula:

1. Simplification,
2. Leverage,
3. Acceleration
4. and Multiplication.

We worked through each step with the team, refining their goals, eliminating unnecessary activities and building on their successes.

I’ll be talking more in future blog posts about how each of these principles work, but I can share with you now that this simple focusing method breathed new life into the client’s work team. Once they focused in on the essential elements of their shared mission, it was amazing how productive they became!

It’s hard to imagine how productive our country could become, even when the financial forecast is bleak, if the Grand Slam Formula was incorporated, team by team, into every company’s mindset. Want to be in on the revolution? Then let’s keep talking! Keep sending me your feedback, questions and frustrations, and I’ll keep telling you how our clients have found success.

It’s going to be a great year!


Steve Thompson, President,
FocalPoint Coaching, powered by Brian Tracy

4 steps for growing in this economy

Four Steps for battling this economy and growing your business .

Let me start with the 5th step first. Think about how this economy is good for you and your business – because, there are opportunities now that will make you grow far beyond your competition.

I get to talk to our coaches all the time, and this gives me a pulse on the business economy that even reporters can't get. Our coaches are in the field every day, working with two kinds of people. Business Owners and Executives within larger firms.

What I’m amazed about today is not only the amount of new business, but the attitude shifts that are already apparent. If we use Bears Stearns as a guidepost, it’s been about 7 months since the first whiff of trouble.

And since that time, we’ve seen market leaders emerge in almost all markets. Who are they? Those same smart, quiet, hardworking business owners and executives who have made the mental shift and looked for roses among the thorns.

If , as a reader you think you’re on the outside looking in, take heart. You can join this group of leaders by changing (or continuing) to think with success in mind. Be one of the people who will just keep succeeding, regardless of the economy. Now that’s lasting change.

And it works for teams, departments and companies in the same way! Imagine leading your team to record sales, production or customer satisfaction, just by focusing their efforts using our key success (coaching) principles.

So what’s the secret? Let me explain it this way: in Focal Point, Brian Tracy tells us that success comes by taking four different steps.

1. Start doing more of the things that bring you the greatest rewards.
2. Spend less time doing things that ruin your chances for success.
3. Third on the list of steps to success is to learn to do new things, gain new skills or find a completely different focus to turn your energy toward greater achievement.
4. Stopping altogether the activities that keep us from succeeding.

If you want to do this as an exercise, grab a piece of paper and make a list, answering the 4 questions above.

Sound easy? Does it sound too easy? Success in business comes from simplicity, not complexity. Keep it simple, execute it well.

As Coaches, that’s one of our biggest challenges – working with Executives and business owners to identify, simplify and execute. We have a system for that, of course!

Fortunately for you, that’s what a good business coach should be able to do with you. I hope these blog posts have convinced you that success is within your reach. All most of us need is someone to help us put it all in perspective and turn us down the right path.

Have a thought, comment, or question? Let us know, we’re here to answer.

Steve Thompson,
President,
FocalPoint Coaching, powered by Brian Tracy

The Success Habits of Business

The Success Habits of Business

I want to talk to you today about something each of us does that can mean the difference between being happy and successful or constantly experiencing failure. That one thing we all do is this—we form habits. Even the most random person you know is actually the product of his habits.

Here’s why: if that person makes the choice to never do anything consistently, he’s formed a habit! He’s in the habit of being random about his life. Whether he’s inconsistent about following up on sales calls or careless about completing his sales reports, he’s formed a negative habit. Every business coach I know has seen the effect of bad habits in their clients’ lives.

If you’ve read Brian Tracy’s groundbreaking book, Focal Point, you know that he spends a lot of time helping readers identify the habits that keep them from success. That’s because he understands that our habits are the foundation of our success or failure.

Think about it—if we never spend time developing the habits shared by successful people, our actions are constantly working against us. Our habitual behavior is what really drives our days. Whether it’s habitually missing appointments or being in the habit of calling our clients monthly, those repetitive behaviors are the building blocks of our future achievements.

One of the great things business coaches do is to help their clients identify negative habits and begin to do the hard, but rewarding, work of turning them into productive behaviors. Changing a habit isn’t easy! If it was, we’d be a nation of slender, healthy folks with fabulous incomes! But given the right motivation and the help of a great coach, business people everywhere are learning the value of developing positive business habits.

I’m going to be talking more in coming weeks about the sticky subject of habits. Stay tuned for those discussions, and be sure to let me know what habits are keeping you from realizing your goals.

Actually, come to think of it, why not break a blog habit of telling you things from our point of view? Do you have a business tool business strategy, great business idea or technique for making or breaking habits? If you do, why not share it with us here?

Coaching is about Adult Education. It’s about learning new things. A great coach is a student AND a teacher, so let’s hear from you!


Steve Thompson,
President,
FocalPoint Coaching, powered by Brian Tracy

Business Efficiency and Being Efficient in Business

Business Efficiency and Being Efficient in Business

I met with a coaching client the other day, and she asked an intriguing question. “Why”, she asked, “Do I work so much harder than our lead salesman and still earn less than half what he does?” I have to admit, I smiled as I listened to her concern, because I knew I’d be able to help her.

The particular principle I went on to introduce her to was what Brian Tracy describes as the “Efficiency Curve”.

Here’s a snapshot of how the Efficiency Curve improves, or destroys, your chances for success. As Brian Tracy explains, learning how to do something like converting prospects to clients takes more time when first approached. As you spend the time learning to do it well, your investment of time should pay off in increased sales and income. That’s an improved Efficiency Curve.

But what if your time is divided between learning how to increase your conversion rate, and five other tasks that have little impact on your success? If you have a choice how to spend your time, doesn’t it make sense to invest the most time on the activities that have a direct impact on your income? In other words, shouldn’t you be focusing your time, effort and intelligence on the most important things, rather than allowing yourself to be distracted with unprofitable activities?

Imagine the improved Efficiency Curve you can experience with each new challenge if your resources are completely focused on that goal. Our race to success is a lot like skiing in a downhill race where one contestant skis in a straight line and everyone else zigs and zags off-course throughout the race. Which skier do you suppose will hit the finish line first? That’s the essence of the Efficiency Curve. Learning to focus your time and effort on the things most likely to result in success will always bring the greatest reward.

So are you ready to find your best Curve? Any resource that shortens the Curve is money well spent, after all! Until next time, let’s work on identifying the things that deserve our focus. That will bring you one step closer to success.


Steve Thompson, President,
FocalPoint Coaching, powered by Brian Tracy

Becoming Your Own Boss, Even if You’re Not Self-Employed

A question we’re often asked by our business coaching clients is how to succeed while working for a difficult boss. Good question.

We don’t know the answer.

However, the path we follow is one they almost never expect! When someone tells us he can’t succeed because his boss is difficult, we have to do some digging.

At some point, we’ll turn the mirror back on the client. What that means is that, in coaching people to business success, we follow the principle of personal responsibility that Brian Tracy discusses in Focal Point.

Here’s what he has to say that turns the average person upside down, “The acceptance of personal responsibility lies at the core of the personality of every outstanding man or woman.” What that means is that, no matter the situation, when things don’t go as you’d planned, you take responsibility for the outcome.

So, how would we, as business coaches, use that principal with someone who believes a “bad boss” is holding them back? We’d first begin to share the tools to understnd how a person can take responsibility for their own success, just as if they were self-employed. Using that approach, rather than blaming the system in which he works, helps us to move a client to a place where he’s making decisions and acting upon them as though the buck stops at his desk.

For some, this is a major shift. For others, it’s tiny shift in perception. It’s a lot of fun when we get to do it with entire teams ( divisions, groups, etc)

In Executive Coaching that one shift in thinking can be seismic in a client’s future! Every decision is suddenly seen in the context of “how do I want to run my business?” whether it’s how he wants to find new clients for his employer or how he can better manage his department. When you can define what you do for a living as a business that you control, it becomes worth careful planning and extra effort.

That’s a lot different than feeling trapped in a job!

This is part of showing our clients how to get control over their day, their career, their life.

You see, once an executive sees themselves from the viewpoint of “self-employed”, rather than someone at the mercy of a system, they start meeting and redefining their goals at warp speed! You don’t need to quit your corporate job and start your own business to benefit from this move toward becoming responsible for your success.

And so, now you’ve had a glimpse into how a business coach works to help a client succeed. Our clients are smart, motivated people who simply want a shift in worldview to help them achieve their goals.

If you have a though, post a response to this blog. We’d love to hear from you.

Steve Thompson
President
FocalPoint Coaching, powered by Brian Tracy

If this economy has you thinking about how to get the edge, here’s someplace you’ll want to visit: FocalPoint Coaching. And if you have questions about how you can become a business coach, why not learn more about one of the premier business coach training systems?