ACTIONCOACH: PAUL BROOKSBANK

Business Growth Expert, Bedford

call me on

07590 584642

Harnessing The Power Of The Business Chassis

And driving your business profitability ...

 
 

POSTED BY PAUL BROOKSBANK ON 08/11/2018 @ 9:00AM

At ActionCoach we refer to 'the business chassis'. The idea being that, whatever the business does, they are all built on the same 'chassis'. This is made up of 5 profit generating areas ...

Once explained, the maths of the Business Chassis becomes clear!

Once explained, the maths of the Business Chassis becomes clear!

copyright: ismagilov / 123rf

These are critical to running a successful business because your entire operation runs on these components. No business operates without them as they are so fundamental and when you consider them as a maths equation, they represent the key figures that lead to business growth and success or business failure and death.

The sad thing is that most business owners don't know the numbers associated with any of these five areas even though they are a critical part of running any business.

But the good news is that when business owners really get to grips with and understand this powerful equation, and begin to implement it into their business, it can be the catalyst to drive long-term success ...

So, let's take a look at each area:

  1. Leads - This is the total number of leads - those people who have contacted or who have been contacted by the business - over the course of a year.

  2. Conversion rate - This is the percentage of people who actually bought. For example, if 10 people walk through a store and three people buy something, that store's conversion rate of 3 out of 10, or 30%, for that day.

  3. Average pound sale - This is the average £ amount per sale (yes some will spend £5 and some £5,000, but we need the average over the year).

  4. Average number of transactions - This is the average number of purchases a customer will make over the course of a year. In a retail setting, this will probably be larger than those companies that operate in the professional services industry.

  5. Profit margin - This is the profit percentage of each and every sale. Simply put, if a business sells something for £100, and profit was £25, the profit margin is 25%.

There are a couple of caveats here. Firstly, the time period you use will vary depending on your business. For small retailers, it may be daily, weekly or monthly whereas some services may only be yearly purchases. Secondly, to plan for growth you will need accurate figures, and this will require testing and measuring to understand what your current numbers are.

"Here comes the maths!"

if, for example, you want to increase the number of customers in your business, you need to look at improving one or both of the top 2 areas, "Number of Leads Generated x Conversion Rate = Number of New Customers". Both can be done, but will each require specific strategies to make your efforts effective and productive.

Moving further down the chassis, "Number of transactions X average £ sale = Total Revenues", so again, to increase revenue, you need to increase the number of transactions and/or the amount they are spending each time.

However, as this is a maths equation, the numbers don't just add up, they multiply! For example, a 10% increase in each of the 5 components of the Business Chassis will result in a 61% increase in the bottom line profits. Small improvements focused on each of these five areas will have a dramatic increase in your business.

The Business Chassis explained!

This is a powerful concept that most business owners overlook! Simply understanding how the maths equation works is game-changing. Then taking the time to develop the specific strategies to use to make the improvement can change the future course of your business.

"Would you like to know more?"

If you'd like to find out more about the business chassis and how you can harness it for your business, then do give me a call on 07590 584642 or click here to ping me an email and let's see how I can help you.

Until next time ...

PAUL BROOKSBANK


PS:

If you're looking for a specialist business coach in the Bedford area, do visit www.facebook.com/actioncoachbedford and let's see how I can help you reach your dreams and goals.


Share the blog love ...

Share this to Google+Share this to FacebookShare this to TwitterShare this via BufferShare this to LinkedInShare this to Pinterest
Click here to Share, Email or Bookmark this website

Précis (0)






More about Paul Brooksbank ...

Are you a motivated business owner working far more hours than you would like in an average week? Do you feel frustrated that despite the hours you work, your business isn’t growing as fast as you’d like and profits aren’t at the level you think they should be? Is a lot of your working week spent fire-fighting and do you think that your time spent in the business could be more productive?

Do you feel like there’s untapped potential in your business but you are so bogged down working ‘IN’ your business, that you lack the time, energy and resources to work ‘ON’ your business and take it to the next level? Would you like to know how you can both reduce the hours you’re working and grow your business faster? And yes, it is possible.

If so, business coaching could be right for you!

Telephone:

07590 584642


More blog posts for you to enjoy ...

Use A Default Diary To Get The Most Out Of Your Day
Consistently dedicating time to working 'on' your business ...

Why Self-Management, Not Time-Management Gets Results
Do you know what's important and what's urgent?

Where Will Your Business Be In Five Years?
Will you have the lifestyle you want?

Don't Lose Money Through A Leaky Business Bucket!
Cash is always king ...

Are You Saving Yourself A Wage And Costing Yourself A Fortune?
You need to step outside your business ...

The 90-Day Planning Cycle And Why It Works
It's vital to have a plan ...

Is Your Marketing An Expense Or An Investment?
The key is to test and measure ...

ActionCOACH: Be x Do = Have!
It's as simple as that ...


This is me!

Keep in touch ...

Send me an email
View my RSS newsfeed
Find me on Facebook
Follow me on Twitter
Connect with LinkedIn

By Category ...

General (3)

Growing Your Business (2)

Marketing (1)

Running your business (2)

Self Improvement (2)

By Popularity ...

ActionCOACH: Be x Do = Have!

The 90-Day Planning Cycle And Why I ...

Is Your Marketing An Expense Or An ...

Welcome To My Brand New Blog!

Are You Saving Yourself A Wage And ...

Where Will Your Business Be In Five ...

Don't Lose Money Through A Leaky Bu ...

Use A Default Diary To Get The Most ...

Harnessing The Power Of The Busines ...

Why Self-Management, Not Time-Manag ...

Login ...



Remember me