Sales are the driving force behind any business. If you’re like most business owners, you are constantly looking for ways to increase sales and make more money.
There are hundreds, if not thousands, of books and how-to’s out there on how to get more sales but, the secret is easy and I’m going to share it with you today.
There are really only three simple ways to increase sales.
2. Closing rate
3. Average ticket
Traffic is the number of people who come to your business whether it is traffic to your website, traffic that calls your office or traffic that crosses the lease line for your store.
Closing rate is the percentage of traffic you turn into a sale. For example, if you have ten people who cross your lease line and you sell to one (1/10) = a ten percent closing rate.
Average ticket is your total sales divided by your total transactions. If you have sales of $1000 and you had 10 transactions, your average ticket is $100.
Let’s look at what happens when you affect any one of these three things.
Traffic goes to 20 and you still only close 10%.
You now have 2 sales at $100 for a total of $200 instead of only $100 with 10 people.
If you affect your closing rate and instead of closing 10% you close 20% it would look like this:
Traffic 20 people x 20% closing = 4 sales or $400 in sales.
Now what would happen if you affected the ticket price?
Traffic 20 people x 20% closing = 4 sales x $200 or $800 in sales.
If you double traffic, double closing ratio and average sale you can increase your business by a factor of 800%.
Now that is extreme and I get that, but what if you just affected each by a margin of 10% instead of double? What would it do to your bottom line?
This is an example of the type of thing I work on with my clients who coach with me privately.
Social media is one tactic that helps to drive traffic. The other two are up to you.
Want more? Here’s a Shop Talk tip on another way to increase your sales.
How will you use this to help your business grow?