Making your business more efficient doesn’t have to be an expensive endeavor. In fact, there’s much you can do without spending an arm and a leg. These ideas can help you realize more profits and be more productive in your small business.
1. Increase the Money You Make From Existing Customers
It takes time and money to acquire brand new customers. In fact, one key metric you should be tracking in your business is your customer acquisition cost. Typically it’s fairly expensive, so you want to keep that cost down. It’s a much more efficient use of resources to find ways to make your existing customers so thrilled with you, that they will want to spend more with you.
Here are four ways to do this:
Sell more products and services to existing customers. For this you need to create additional offerings that are attractive to existing customers. Think complementary products and services to what you already offer — what do customers ask about and what are the problems they have that you can solve?
Get a higher percentage of existing customers to renew. You could offer discounts for renewing early, or a discount for a long-term contract.
Get existing customers to want to pay you more (e.g., raise prices if you haven’t raised them in a while, or create an upgrade path to a premium-level product).
Work on strategies to increase loyalty and stay top of mind with customers. Examples are regular emails, social media outreach, thank yous and other communications that keep your customers’ attention.
2. Ask for Referrals
You already have customers who adore you. Rather than spending time and money looking for new customers, leverage the relationships you already have. Ask your best customers if they know anyone else you could help with your products or services. Offer a referral fee or simply make it easy to refer others (such as adding a refer-a-friend link in emails).
3. Automate Your Emails
Email is one of those things that gives you a ready audience to market to — without the need to rely too heavily on expensive advertising campaigns.
Email marketing largely can be automated (other than creating the content for the emails). If your email marketing is one of those things you do intermittently or “when you have time” then you’re not leveraging the power of email.
Make sure you have a house list started; a strategy for building that list; and a regular email communications calendar.
Every time someone new signs up for your email newsletter, they should receive a welcome email with information about your brand. And no, you don’t need to manually send these.
Email marketing tools like AWeber, Infusionsoft, Constant Contact and MailChimp let you set up autoresponders so you don’t have to worry about it. They give you leverage. Whatever tool you decide to use, master it and use it to the utmost — you’ll be glad you did.
4. Make Sure Your Website Carries its Weight
What I mean is, you need a website that helps you generate leads, take orders, assist with customer service, and/or do other transactions that add to your business. Your website should be more than just a brochure.
Take a long hard look at your website, See what it could be doing for you, besides marketing. Do you have a lead form on your website? Do you have a knowledge base, live chat and/or a ticket system to help with customer inquiries? And what about scheduling appointments or delivering your products or services — can your website help with those?
By incorporating transactions into your website, you make your website work harder for your business, and it can be cost effective because it can cut down on manual activities.
5. Work Tirelessly to Improve Your Internal Systems
Having good internal systems and efficient workflow is crucial to profitability and also to your ability to scale and grow your business.
If your business is a small startup consisting just of you, then efficiency may be a matter of your time management.
But if you have any kind of organization behind you — even one or two outside contractors — then the issue is also about workflow and your internal systems.
Inefficiency can eat up all your profits. Things like re-working a project because something was doesn’t done right the first time can take a profitable piece of business and turn it into a money-loser in short order. Or consider the cost of having too many people touching transactions because you haven’t given enough thought to logical workflow processes — people costs tend to be one of the biggest expenses in a business.
If your business is not efficient when it is small, that inefficiency will only be magnified as you grow.
In most small businesses, unlike working in a larger company, there are NO processes until you create them from a clean sheet of paper. And that takes deliberate effort. But do it well, and your business will be operating like a well-oiled machine in no time.