Planning for a Sizzling 2012 (Step 2)

Posted: November 29, 2011 | Categories: Sales, Self-Improvement

How much are you going to make in 2012?  What will your profit margin be?  Specific goals, action steps, benchmarks and deadlines are all part of an effective business plan.  So how do we come up with a revenue goal that is realistic, challenging, and well supported?  Here are some questions we can ask ourselves to achieve that objective:

What was our revenue this year?

Where did it come from? Many companies have different streams of revenue.  In this step, we need to break it down for more accurate analysis.  A pie chart can help here.

 Looking at all your streams of revenue, which ones produced the greatest volume? How about profit margin?This can be quite revealing.  A few years ago, I was working with a company that asked themselves this question, and discovered that they had a stream of revenue that was only 10% of their overall volume, yet the profit margin was very high.  With this information, they changed their strategy.  Today, that revenue stream that was generating only 10% of their volume is now generating 80% – still with a healthy profit margin. 

 Considering your revenue stream with the highest with the highest profit margin, how were you able to maintain that margin?

Asking this question can engender a healthy discussion that can lead to better knowledge of your niche, or unique selling proposition.

 What are new revenue streams arising that play to your strengths?Remember when copiers, fax machines, and scanners were distinctly separate devices?  Holy Cow!  A fax machine is a copy machine also!

 What is our revenue goal for 2012?

What do we need to do more of, less of, or differently to realize this goal?  (If nothing changes…nothing changes)

 Have you even seen a situation where a company has set a revenue goal year after year and always has fallen short?  That can lead to frustration and negative inertia.

The majority of my clients have had a good year.  Here are some best practices I have observed with these clients:

Unique Selling Proposition

Ask yourself this question:  What is it that you and your team do, and do so well that nobody can touch you?  In order to make a healthy profit margin today, we need to deliver our product or service in a way that is so special, our clients don’t believe they can replicate it.  Want an example?  Apple.

Pursue High-Margin Work

When we know our unique selling proposition, we can now focus our sales efforts on getting those contracts and PO’s.  This saves a lot of valuable time.  Who wants to spend their resources on work that amounts to just “trading dollars”?

Action steps:

1. Look at what you made this year
2. Analyze where it came from
3. Evaluate
4. Set revenue goal

Next blog:  Mapping a strategy that will lead us to our goals.

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