How to double the size of your business – even in a recession
Author: Russell SmithMarch 7, 2012
Last Thursday I did a telephone seminar on ‘How the recession has changed business and what to do about it’. Not surprisingly, given the subject matter, it was one of my biggest calls yet.
I will be sending out CDs of the call early next week so if you missed the call, get on the email list and I can send you a free copy.
One of the points I talked about is that, even in a recession, you can double the size of your business. Doubling the size of your business is actually very simple. It may not be easy but it is simple. It is just a case of knowing your numbers, knowing what they mean and then using mathematics to increase them.
In a recession, many of your competitors will be retreating or consolidating which can give others the chance to grab market share and grow quickly.
The risk of this, is that you have to know your customer acquisition cost and be totally on top of your cash flow forecasting so you don’t get carried away by winning lots of business but not having the cash flow or resources to service the new customers.
So, in a nutshell – here’s how to double the size of your business:
Step 1 – Work out what your profit is now
Step 2 – Double the profit
Step 3 – Using the profit margins of your current year, work out what your turnover would have to be (often your net profit margin will increase as a % the bigger you get, though not always, so you’ll need to be careful here to be realistic)
Step 4 – Work out how many leads multiplied by your conversion rate multiplied by your average sale gets to your turnover figure
You can do this fairly quickly, with more time, you can flesh out the detail on it and assess what extra cost will an increased turnover bring (IT, People, Systems etc.).
However, you’ll notice that the two things this relies on is knowing your numbers and being able to increase your sales.
On Thursday 29th March, I am spending the day with 10 select business owners to teach them how to do these two things and double the size of their business.
Very few people know about this and I will be sending out some more information to my subscribers in the next week but if you are interested in grabbing one of the spots (1 has already gone before I have even written an invitation so technically there are 9 left) feel free to email me at firstname.lastname@example.org