Stop Struggling with Cash Flow and Deliver the Potential of your Business
If you’re struggling to improve your monthly cash flow, this article is for you.
I’m going to describe a tried-and-tested strategy to increase your revenue, and make 20k a month in your business.
Let’s face it, you didn’t go into your own business to struggle, did you?
You set up your business to follow your passion, leverage your skills and build a saleable asset, whilst enjoying your lifestyle along the way.
But it’s not quite working out as you had planned. The question you need to answer is:
How do you get your dream on track, and still be able to take care of your loved ones, without returning to working for someone else?
We’re here to help.
Cash flow – the root of business success (and failure)
Cash flow is crucial. With positive cash flow you can do things like marketing, hire experts and put on new team members.
I’m sure you’d agree that those three things alone are important.
Build it and they will come is a strategy, just not a very successful one.
Spending 4-8% of your revenue on marketing will help attract people to your business.
We all have strengths and weaknesses. It is best to leverage your strengths and seek the help of experts to compliment your weaknesses.
Finally the team.
Michael Hyatt says: “ If you don’t have a team you have a job”
Cash flow – or should I say, the lack of it – is the number one reason for business failure. Indeed, research shows that:
In the United States, the BLS reports that 20% of new businesses fail within two years, and almost half within five years
It’s a similar story in all countries.
But I don’t need to delve into research to understand why so many new businesses fold so quickly. In my work with business owners, the biggest challenge they all face is insufficient revenue.
When we work with business owners and help them create a system that boosts sales and delivers higher revenues, cash flow problems subside very quickly. The outcome is greater sustainability, the ability to boost sales even further, and, of course, higher profits.
Six steps to boost your cash flow
If your business is suffering because of poor cash flow, you need to act fast. In my career in sales at Coca-Cola, I’ve tried out lots of different tactics to increase revenues. I’ve taken all my experience of testing and tweaking a variety of strategies, and developed the following six steps to sales success.
(In a hurry? We’ve put together a handy summary checklist of all the six steps so you can easily reference them and apply them in your business. Grab the free checklist now.)
Step 1: Stop wasting time
In their blogpost ‘Time is a commodity – use it or lose it’, our friends at Level 5 Mentors discuss how important it is to make the best possible use of your time. They quite rightly point out that great time management is the ‘golden thread that connects all successful entrepreneurs’.
You only have limited amount of time. The more time you waste, the lower will be your productivity and sales. As a business owner time is your most valuable resource, and how you use it will strongly influence your success. Here are some examples of time wasters that are destroying your ability to boost your sales:
1. Social media
Social media is the newest toy for the business world. Every pundit will tell you this is how you engage your customers. And social media absolutely can be a powerful tool, but only in moderation.
In truth, if social media is distracting you from the important parts of your business, it is costing you money, not making it. Focus is what you need to get you operating successfully.
2. Cumbersome and repetitive tasks
There is a whole hatful of tasks that you do time and time again. They are repetitive and cumbersome, yet most must be done. If they aren’t done, you don’t follow up on leads, fail to invoice on time, and you don’t maximize your opportunities.
Such tasks include research, emails, sales letters, orders, audits, invoicing, and so on. What can you do about this unrelenting flow of repetitive work that must be done? Here are the four tactics to use:
- Analyze it
- Eliminate what doesn’t need to be done or adds no value
- Automate whatever can be automated
- Delegate as much of what is left
(Read our article ‘Target sales more effectively by hiring a sales assistant’ to learn more about point iv.)
Don’t believe the hype about multitasking boosting productivity. It doesn’t. Switching between tasks causes you to lose focus. It takes time to pick up the thread of what you were doing. Stay focused on one task at a time, and you’ll be way more productive.
Here’s a challenge for you. For one week, keep a diary of each day, what you do, and how much time you do it for. You’ll be surprised at how much time you are wasting. Time that you could be spending on selling.
Step 2: Get crystal clear on your ideal client
I often see people wanting to please everyone. You know how that ends!
If you were going to have 1,000 fans in a room, who exactly would you invite? If you want help from people to refer you, you must be clear on who you are targeting.
It’s imperative that you identify your ideal customer. The one that will take the least effort to deliver the highest return. When you know who you should be selling to:
- Your marketing expenditure isn’t wasted on people who don’t care, and who could become frustrated with irrelevant ads (these people certainly won’t be easy converts)
- You can tailor your strategy to the ideal client, because you know so much more about them than a general ‘audience’, making your ads more engaging and effective
- Your product, and variations and iterations, will be easier to create, because you have a clear idea of the person, and are keeping in check with their specific needs, as they evolve
To get this clear picture, you need to have a good idea about your ideal client’s age, location, interests, job structure, work-life balance, frustrations, needs, business goals, etc.
Essentially, the more you know about your ideal customer, the more you grow.
Though you’ll need to put a good deal of effort into this, the payback is going to be huge. Like the Pareto Principle says, you’ll find that 20% of your current effort and time delivers 80% of your results.
So, what should you do now? Fill out this template to work out who your ideal client is.
To make 20k a month you need more and better clients.
Step Three – Ask for referrals
Once you are crystal clear about your ideal customer, it’s time to get help recruiting them.
Now, you can (and should) use social media to target your ideal customers. Inbound marketing is a proven way to attract visitors and create leads all the way down your sales funnel. And, when you create content that is more highly targeted – because you know your ideal customer – you should improve the customer experience and boost your conversion rate.
But, here is the thing – as social media increases the number of ads it presents to its users, those users are turning off. Think about how people hate being bombarded with ads on Facebook. People are also becoming more wary of social media as a communication channel that can be trusted.
Combine these factors, and you’ll understand why more people are turning to referrals. This is where your network can be employed to work for you.
Now, I understand that it can feel awkward to ask for a referral. So, here’s what I recommend:
- Open the conversation with something like, “Hey, do you know of anyone else needing X service? I’m looking to expand my customer base, and I’d love your ideas.”
- Keep it simple: just because you’re asking for a referral doesn’t mean the word needs to be the first thing out of your mouth!
- Alternatively, think about this: “Hi, I’m trying to build my business through referrals. Would you know of anyone?”
- The key is to stay gentle, but firm on your goals.
As soon as you have identified your ideal customer, it’s time to start engaging your network in your drive for more highly productive customers. Here’s your action point:
Ask for one referral from 5-10 people who know and who trust you. It really is that simple.
Step Four: Use a sales script
When you or one of your team make a sales call, it’s important to sound confident, make a good impression, cover all the points that must be addressed, and get all the information needed.
You don’t want referrals to hear a stream of ‘um’s and ‘err’s. You don’t want to look amateurish by calling back for a piece of information that you forgot to ask for.
A sales call framework will help you avoid all the common mistakes made on sales calls – but only if you use it effectively. It isn’t something you want to read out verbatim. Doing so will make you sound unprofessional, stilted, and inexperienced.
So, get comfortable with your sales script, and be prepared with questions and answers that are slightly ‘off script’ to cover possible answers you receive, questions you are asked, and to help the flow of conversation that will build rapport.
After training salespeople at Coca-Cola for 18+ years, I learnt firsthand the power of a sales script. It’s unrivalled as a sales tool.
To take the first steps to developing an effective sales script, use these sales triage questions that we’ve shared with Accelerate members, and tailor to suit your own needs.
Step 5: Follow Up
Not following up on any sales call is a huge mistake to make.
How often have you been contacted by a salesperson, and you’ve shown interest? Perhaps your interest in a product or service has been encouraged by a blog you’ve read.
You’ve emailed the business like suggested at the end of the blog, but after a few days you still haven’t heard anything. Or you’ve waited by the phone for that follow-up call. Again, nothing.
When this happens, you give up. Or you move on, find another company offering the same product or service, and deal with them.
I see clients members leaving money on the table all the time.
In one Harvard Business Review study, it was found that firms who attempted to contact a customer within one hour of receiving a query were “nearly seven times more likely to qualify the lead”. Yet, in another HBR study, it was found that fewer than 4 in 10 businesses call back inside 60 minutes.
This is a huge window of opportunity for you to exploit. Be the business that does what it promises. Be the company that calls back quickly. It’s a competitive edge that could propel your sales at an incredible pace.
What’s the best strategy to make sure this happens? Use a great sales Customer Relationship Management (CRM) tool to make tracking sales opportunities and following up easy.
Step 6: Stay accountable with an accountability buddy
Your sales are your responsibility. Therefore, you must remain accountable for your actions and your performance.
If you spend a half an hour on your social media when you could be calling prospects and booking sales appointments, it’s down to you.
If you waste energy on selling to an audience who isn’t going to turn into customers, it’s because you haven’t identified your ideal customer.
Those referrals won’t appear out of thin air.
If you lose track on a sales call, I bet you’d wish you had prepared a sales script.
Those callbacks you make when the lead says they have bought from someone else? Could you have called back sooner? Like, perhaps, three days ago?
If you’re trying to lose weight or bulk up, it always helps to buddy up, doesn’t it? Your gym buddy will make sure you turn up, put the effort in, and hit your milestones. It’s the same in sales.
Get an accountability buddy. Share your sales activities and results with each other every week. Gamify it by having a reward when you meet certain targets.
According to Developing Good Habits, the top seven benefits of an accountability strategy are:
People make better choices under observation, which ultimately raises performance
You get honest external feedback which challenges your assumptions and ensures you’re taking the best path
You must follow through on commitments, and can’t just lose sight of your business goals
This also applies to deadlines – if they’re public, it’s much harder to bend them
You can’t just escape into daydreams; you remain grounded and focused on the actual day-to-day tasks necessary
You can learn from the mistakes and successes of others, through your mentor or partner
Problems don’t snowball because there’s another set of eyes watching as soon as the little problem crops up
Inside our Sales Machine community forum, we have a ‘Track your progress’ section where members can post their weekly or monthly goals, and then provide regular updates on how they’re doing.
This also allows other community members to add encouraging thoughts, suggestions, or questions to help you stay on track.
Get yourself an accountability buddy as soon as you can. Don’t be a lone wolf, it’s a fast-track to failure.
Now you know how to make 20K a month… are you going to act?
Hitting $20K a month in revenue is significant. It means your business has steered clear of the danger zone in which so many small businesses fail because of insufficient cash flow.
When you hit 20k each month, you’ll have enough cash flow to pay yourself a good monthly salary. You’ll be able to bring in the right people and resources to help you scale your business, make a bigger impact, and pump up your profits.
Most importantly, 20k per month is when you’ll free up more time to do the things that are important to you. You’ll sleep better at night knowing that your family is being taken care of.
Take a moment to imagine what that would feel like… powerful, right?
Implementing these six steps has worked for other clients, and it will work for you, too. All you need to do is commit. Implement the six steps to success in your business today.
Are you ready to act?
We’ve put together a handy summary checklist of all the six steps so you can easily reference them and apply them in your business. Grab the free checklist now.
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Stop Struggling with Cash Flow and Deliver the Potential of your Small Business
If you’re struggling to improve your monthly cash flow, this article is for you. I’m going to describe a tried-and-tested strategy to increase your revenue, and make 20k a month in your small business.
Let’s face it, you didn’t escape your corporate job to struggle, did you? You set up your business to follow your passion. You dream of supporting your lifestyle with work that makes you…
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