There are five areas in your business which affect your bottom line.
They are:
1. Number of Leads each week
2. The percentage of those leads converted to customers
3. The dollar amount of each transaction for one customer
4. The number of transactions per customer
5. The profit margin on each transaction
If you can improve the numbers for any one of these five areas, you can improve your overall profit for the business.
Note that ‘number of customers’ is not in the list, because the number of customers you have is really a result of the number of leads you have, and how many of those leads are converted to customers.
Now, since you know there are five different areas which can affect your bottom line, then by making small improvements in each one of these areas, you can see a dramatic improvement in your overall profitability.
Also note that ‘profit margin on each transaction’ is only one of five different factors impacting your business. Most people only think of that one when they talk about improving their profit. But there are many ways to positively impact your business. Give attention to all five of these and your business will thrive.