We operate today in a business world where our economy is struggling, unemployment is high, and the average household income is decreasing year after year. Why then do so many businesses constantly increase prices on their products/services? I get that the cost of doing business has skyrocketed and that making a profit is difficult to say the least. But have you ever considered, as a business owner/manager, that less is more? Perception in life and in business is often the cause of misunderstanding and strife between people. This is no different in sales. There has always been a perception of value that drives one to purchase a product or service. When that perceived value is no longer valid, you will look elsewhere to find your desired value. Most people, when comparing equal products/services, will select the least expensive product/service to purchase. It’s human nature and in today’s economy, it has never been more applicable. The problem is that companies perceive that they need to make more on every product sold because their cost to make every product has gone up. I am here to say that profit margins are only valid if you collect them. Sales is all about volume, not about individual one off purchases. We treat loyal customers like they have to shoulder the brunt of our business expense and assume they will stay loyal to us. Think about this as you read my blog today……..would you rather have 10 customers paying $100 each or 100 customers paying $70 each? Volume allows you to upsell, to gain referrals, and to create a broader base of support for your product or service. It is basic economics that when anything costs more, demand is less. I was asked once if I wanted $1 million dollars cash or to double a penny every day for 30 days. I had 5 seconds to decide. I saw $1 million dollars and not the measly penny. What I missed was $5,368,709.12 dollars at a penny doubled every day for only 30 days. (how many of you have a calculator in hand right now?) This was a perfect example to me of the perception of immediate reward versus consistency over time. Are we missing this same principle in business today? I urge you to break your business down and examine your expenses. Determine what is a fair price for your product or service and blaze a trail that others will follow. Don’t be a sheep and follow everyone else. Be different, be a leader, be successful. Instead of looking at each sale as a profit center, look at how many sales you need to make the profit you desire. Take some time and do the math on your business so you can develop a plan, then a forecast and go get it. When I was a business consultant, I can’t tell you how many businesses didn’t even have a sales forecast. Business owners would simply have an idea, open their doors for business, and assume customers would flock to them to buy their amazing product/service. Just food for thought but, when the movie said “if you build it they will come”, they were not talking about business. I want to end my blog today a bit differently. I want your comments, your challenges to my thoughts, and most of all, your stories of blazing the way in business. Be different and most of all remember that in sales, Less is More!
Less is More
