Learning how to lop 10 hours off a typical work week without sacrificing any income is possible and it’s easier and faster to accomplish than most entrepreneurs think in three steps. Harry Welby-Cooke, COMENSA president, business and executive coach and Master Licensee for ActionCOACH South Africa, tells you how.
Step 1: Fire extraneous customers
The first rule of any time management system is to utilise the time allotted most efficiently but still make the same money. As the saying goes; time is money and the thief to be most wary of is the one who steals time.
Fire customers who:
- tie up sales people with inconsequential sales;
- steal valuable time with constant complaining; or
- waste your accountants’ time chasing them for payment.
Either get rid of them or transform them into customers who proactively feed the bottom line. While this approach may sound radical, it’s practical to only focus on customers who respond with profitable transactions.
Eliminating customers may involve deleting dead-end leads from the database or it may mean sending them to a business that more appropriately matches their purse. Try adjusting the magnets that are attracting unwanted customers in the first place like discounts and freebies.
Step 2: Money is a great time saver
Entrepreneurs who know how to make money can leverage it to carve out more time for themselves. The key is to convert unprofitable interactions into profitable ones. This is a fool-proof formula for saving more hours each day without compromising productivity or earnings.
1. Know what makes money
To prepare for profit-boosting initiatives, gather accounting data and metrics to get a clear picture of where your profits are being generated, how many contacts are being made with customers each month and how many customers make actual purchases. To harvest such information use software connected to point-of-sale terminals or cash registers.
2. Market your business
Next, launch a marketing and advertising campaign to generate new customer leads to encourage existing customers to buy more and to promote the most profitable products or services.
3. Rework your business model
Part of this effort should involve a new way of looking at the business model. Most entrepreneurs see the future of their companies in terms of products and services that fill a particular market niche.
4. Get customers to spend more
Instead of looking for the ideal items to sell, invest in purchasing the loyalty of the perfect customer. Rather than chasing market share, chase ‘wallet share’. No matter what a business sells, it’s ultimately the customers and how many times they spend money that generates the profits.
5. Invest in customers
Invest in attracting and retaining good customers. Instead of reinventing the wheel, find out who’s buying wheels and turn them into steady customers. Sell them a premium wheel with a wider profit margin. Then sell a set of wheels to your customers’ family and friends.
6. Reward your customers
Once an expanding customer base is established, use incentives such as superior customer service, in-house financing, exclusive product lines and preferential customer perks to inspire them to double their monthly transactions.
7. Sell them what they need
Try up-selling customers to premium products. Cross-sell them to accessories or add-on features. Even down-sell to them by offering a more economical version of the product they can’t yet afford so that they don’t take their business elsewhere.
Step 3: Enviable options
Now the business owner has options:
- Close the business for 10 hours a week, take time off and settle for making the same monthly income that was generated before boosting profits; or
- Leverage that newfound success for progressive changes and forward momentum.
You can also maintain the same hours of operation, capture the extra profits and then reinvest those in greater timesaving initiatives.