As your business begins its annual climb up the revenue mountain there are four steps that are essential to achieving profitable revenue growth.
Your company can increase its profitable revenue by working to maintain those clients who are your company’s BEST clients and targeting prospects who will become your BEST clients. Don’t waste your team’s time, energy and resources by keeping the wrong clients and targeting the wrong prospects. Hour upon hour will be devoted to keeping existing clients and gaining new ones, make sure they offer you the best opportunity for increasing revenues and profits.
Many business leaders often find themselves wondering why the clients that take up 80% of their organization’s time only generate 20% of their revenue or profit. It’s because they are focusing their valuable time, energy and resources on the wrong clients and prospects.
Typically, business leaders rely on reports in just a few categories to determine their top clients. Those that show who generated the most revenue, generated the most profit, how long they’ve been a client, etc. And, yes a client may be at the top of the list in a given category, but are they one of your BEST clients?
The only way to meet your company’s profit and revenue goals and insure long-term success is to have a steady stream of business from your BEST clients. In the B2B world these are clients who:
- Purchase your product or service on a frequent basis and at a high enough volume to keep your employees consistently busy and productive enough to warrant their full time employment
- Generate enough profit to not only cover the overhead and taxes, but to actually contribute to your retained earnings
Companies in the B2B world have a finite and identifiable list of clients and potential clients. Every day business leaders refine and tweak that list to focus their team’s efforts on those who they believe will buy the product or service they are selling. When a sale is made it reinforces the belief that these targets (now clients) are great for the company simply because “they buy from us”.
A sale is made, revenue and profit (hopefully) is received, people continue to be employed and therefore, the best news of all, the company stays in business. Or does it? Every day businesses with revenue and profit go out of business.
The essential four steps to profitable revenue growth:
- Determine who your BEST clients are – Who buys enough, at the right frequency and profit to warrant your investment of time, energy and resources?
- Learn everything you can about them – Why do they buy with that frequency? Why do they buy from you? What are the patterns and characteristics they share?
- Improve the product or service lines they purchase – Make sure that you are meeting their needs on an on-going basis. Develop your relationships with them, ask them what they would like to see improved?
- Develop and implement the strategies, tactics, and processes to get more of them – Once you know the characteristics of your BEST clients, focus your marketing and sales toward those groups.
Growing profitable revenue depends on having more clients like your BEST ones. They aren’t necessarily those clients at the top of a list showing most annual revenue or profit. Take the time to understand your company’s BEST clients and work to get more like them. Your company’s future depends on it.
At Resultist Consulting we use a tool designed to uncover our client’s BEST clients to help them in their quest for growing profitable revenue. It is a spreadsheet that, with minimal data entry, will enable you to understand who your BEST clients are.