Your Business Checkup

Just as doctors encourage you to have an annual medical exam, your business, no matter how large or small, should also undergo a checkup each year. How can you gauge the effectiveness of a marketing campaign or changes in your service, billing, etc., without analyzing the benefits and bottom line?

Here are 10 questions to get you started:

1. How do your year-to-date sales compare to the last couple of years? Don’t breathe a sigh of relief yet if you managed to match them. If sales have stayed the same, you have achieved zero growth. With inflation, this flat growth is a warning sign for more serious ailments down the road.

2. What percentage of your business is repeat customers? If you’re not sure, find out. This is an important figure to know. If it’s low, it needs to be improved. Experts estimate the cost of getting a new customer versus retaining an existing one can be as much as five to one, in terms of dollars spent. It’s easy to see how this could be the case when you consider the  rising costs of advertising and direct mail.  Therefore, the argument can be made that keeping current customers is more important and cost-effective than constantly seeking new customers.

3. How long has it been since you introduced a new product or service? Loyal customers like to see you changing and progressing with the tunes. Stuck for an idea?  Ask customers what they need.  

4. Do you consider marketing and advertising expenses or investments? How you look at the money you spend in these areas affects your willingness to spend money at all. Would you look at prescriptions as a complete waste of time and money?  Marketing is really investing in you, your vision and your company.  The old adage that you have to spend money to make money is true. However, you must spend it wisely. Are your ads pulling responses and orders? If not, then perhaps it’s time to change publications, designs or wording.

5. Do you know what PR is and how to use it to positively position your company in the media? I will bet that at least one of your competitors does. Nearly every mention of companies in newspapers and magazines is a direct or indirect result of publicity efforts. Being quoted or featured in an article speaks volumes to readers (your potential customers) about your expertise and credibility. A good PR consultant can do that for you and show you ways to extend the shelf life of that article beyond today’s newspaper or this month’s magazine.

6. Are you listed in the Yellow Pages? Along with the line listing, consider including a small ad if you can afford it. It will pay dividends throughout the year.

7. Do you treat your regular customers even better your one-timers? You should. If your customers don’t feel special about coming to you for products or services, why should they remain loyal to you?  Have a customer appreciation day or a special  invitation-only sale for your regulars.  Create a mailing list of your best customers and learn to recognize them on sight if you have a storefront.

8. How long has it been since you really talked to one of your customers? Just as you appreciate when your doctor takes time to learn how you’ve been feeling in recent months, you should make an effort every week to learn more about your customers and their needs.  If you have a service business, call or have lunch with clients on a regular basis (even if they contact you only a couple times a year for projects). The personal touch in an  impersonal world will be remembered.

9. How are you faring in comparison to your competition? Every company, no matter what size or line business, has competition – even home-based businesses. Who is your competition? Is their business growing or downsizing? Is their pricing or service better than yours? If so, what can you tell potential customers about that price difference? Maybe your products or services cost a little more, but you offer a money-back guarantee, more personalized attention or faster delivery.  How can you improve your service to meet or exceed your customers’ expectations?

10. Are your employees happy? You don’t need to ask them directly to find out . Watch, listen and learn. Employees who like their jobs do not watch the clock for quitting time, aren’t habitually late, don’t have poor body language, don’t spend too much time on personal phone calls and don’t look like they’ve never smiled. Observe how they interact with customers. Not everyone is a good match for direct contact with the public.  Make sure you don’t have an employee who is actually driving business away. Show your employees you care and have respect for them.  Ask for their feedback. Be uniform in enforcing your company’s policies. Share successes with your team.                                                  

After considering these 10 points, how would you rate your business on a scale of one to 10? Don’t take time to think about it. Trust your gut instinct The first number that pops into your head is probably the correct one. Anything below an eight or nine means there is definite room for improvement.                                            

Now ask employees and customers the same question: What would they like to see your company do differently? Why? These people offer an alternate, more objective perspective. Consider a brief written survey if you feel uncomfortable doing this directly. Then follow up and follow through with suggestions to show you’re serious about your business, about keeping current customers and attracting additional customers in the future.                                         

Happy customers mean a healthy bottom line.  Here’s to your health!