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How do you know how well your business is doing? It sounds like a simple question but, as Hany Mustapha of www.electronicworkplace.com explains, being able to measure success is the key to making your enterprise a real winner.
Many entrepreneurs would mention the freedom, the mission, the opportunity. Ultimately, though – surely we’re in business to make money. Money not only allows us to eat, fuel the car and pay the phone bill – it also provides the only objective measurement of our performance. And that’s the key – measurement.
We may have a fabulous product set, deliver the finest service and have a wonderful infrastructure (well – and then we wake up!) but without the ability to measure each of those, we are in danger. Competitors will start nibbling at our heels, opportunities to improve customer service will not be identified, inefficiencies in our costs are not addressed.
Measurement is not something that happens three months after the end of the tax year or every quarter when we do the VAT return… to be truly effective it needs to be happening all the time. Information needs to be accessible to the right people at the right time.
Do you know how much it costs you to find another customer? Indeed, are you actively seeking new customers? No – really going out there and telling the planet about how much better off they would be by using your products?
How much does that cost you? Where are you getting most bang for your marketing buck? How much would it earn you to increase what you’re doing where it really works?
The first element of business intelligence is making sure you collect the right data! There are only two ways to increase profits – raising revenues and/or reducing costs. With companies of our size – up to 10 to 15 staff - the easiest way to increase profits is to raise sales. We all believe that our costs are at the minimum level to maintain reasonable business function.
Are you sure? If you employ someone who’s primary role is to answer the phone – are you really getting value for their salary? Think about it – salary of, say, £14,000 pa. Add your National Insurance, lose four weeks of holidays / time off, together with, say , another five days off sick over the year and your receptionist is costing you around £330 per week.
How many phone calls are you taking? 20 a day? Do you know how many phone calls you receive? Shouldn’t you – after all – it’s probably costing you £3 every time it happens!
What would happen if you also tasked that person with making outbound calls while they weren’t busy. Startups.co.uk has some fantastic resources to help you get names and phone numbers… use them! Get your receptionist to make those calls – and then measure the results.
It could halve the costs of receiving calls and free you to follow up the results of those calls – reducing sales costs, and earning you money – raising revenues and profits Great in theory – but how do you move it out of the theoretical and really start measuring how much every element of your business earns you or costs you?
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