Recently I responded to a request to help small businesses that were feeling despondent because of falling sales and general feelings of frustration with marketing a small business in difficult, trading times.
This series of Keep Calm articles has been created to help improve feelings of confidence and personal power; Part 3 will focus on tips to improve Cash Management and Pricing:
Focus on Cash Management
Cut expenses and track cash flow carefully. It is extremely important for you to understand your monthly cash position. Determine where you can cut costs, and make sure on a weekly basis that you understand what money is coming in. As you cut costs use this formula, for every $2 dollars you cut in business expenses, invest $1 into your marketing investment.
Start collections at 7 days past due. You need your money now. Once a customer gets to 7 days past due, get on the phone and track down whoever pays the accounts for an update. Be sure you are ready with payment options to get paid faster.
Focus on Pricing
Time to raise your prices? It’s a new financial year and with the cost pressures of the last year, it’s reasonable to consider your pricing. If you raise your prices by 1% that will give you an approximate 11% increase in income. In comparison, you would need to increase sales volume by 1% to yield a 5% increase in income. One warning though, don’t tell people you are raising your prices because of the Carbon Tax – as you have seen, this is not good PR.
It’s important to add value, when increasing prices! Continuously adding value to your products and services is the best way to get repeat customers and new business through referrals.
The secret of pricing is this knowledge: When the right customer sees your product or service in the right context – price will not be the primary element in their decision to buy!
If you need support from someone who can guide you – a coach or mentor who can look at your business and your progress with an honest and objective eye; guide you away from costly mistakes and head in a direction that may challenge you, but also helps you to survive and thrive – please contact me. The next Keep Calm topic will be “Mindset” – how to stay positive and outcomes focused!
Let me know if find you find these tips helpful? Please leave a comment below:
Author, Teresa Bassham principle Marketing Coach at Zenworkz Marketing, inspires small businesses to foster a positive marketing mindset and develop a empowering marketing plan for business profitability. See full services at http://www.zenworkz.com