Hi Fellow Networkers,
How can you increase your consulting business revenues by 38%? Its seems
impossible, you are working full out and don't have time to breathe. How can
Zale possibly teach me anything that will make a difference and increase my
revenue so substantially. What could Zale possibly know about my business that
I don't know.
The truth is, Zale doesn't know anything about your business that you don't
know. But, Zale does know that there are some basics about business and
marketing that can be applied to all consulting businesses. Most consultants
are so busy working in their businesses that they don't have time to work on
the business.
I want to help you solve your problem of having no time to work on the business
with a couple of short lessons on increasing revenue for your business. The
goal is to provide strategies that will increase annual revenues by 37.5% each
and every year. The goal is to keep applying the strategies at a greater and
more sophisticated level
each year.
I am going to teach you how to leverage the Magic Profit Formula.
Business people are intuitively familiar with the Magic Profit Formula, but
where they break down is in the application of the formula. But the problem is
that most consultants (and in fact most small business people) don't take time
to apply the Magic Profit Formula to their business. This is what I mean by
working on the business instead of in the business. There are many simple and
very effective applications of the formula that once I show them to you, they
will appear obvious. My showing you the techniques will make it simple for you
to implement them.
Let's review the Magic Profit Formula:
(CurrentClients + ( Prospects x ClosingRatio)) x AverageEngagementRevenue =
GrossProfit
Let's take a short look at how the formula works in practice:
First let's make some simple assumptions. I have chosen the numbers so that its
easy to follow the examples. Put in your own numbers and the results will
reflect
your business:
* You have 10 clients that you receive revenue from. Therefore
CurrentClients = 10.
* You have 100 prospects that you are trying to get revenues from. For our
example a prospect is somebody who knows you and you have had a chance to close
business with them. Therefore Prospects = 100.
* Your closing ratio is 5%. This means that 5% of all the prospects you
have become clients. Therefore ClosingRatio = 5%
* Your average engagement revenue is $1,500. This means that from every
client you receive approximately $1,500. Therefore AverageEngagementRevenue =
$1,500.
* Your gross profit before any expenses is all the money you bring in
before you pay your bills.
Now let's put it all together:
(10 + (100 x 5%)) x $1,500) = $22,500
Now let's do what I call fun with numbers.
What is the effect on your Gross Revenue if we were to increase the number of
prospects by 20%? Therefore Prospects = (100 x 1.20) 120
(10 + (120 x 5%)) x $1,500) = $24,000
For all
the time and effort needed to increase prospects by 20% result in only a 6%
increase (24,000 - 22,500)/22,500) in profits. While increasing prospects is
important, its clear the return on value is not as great as the effort. Effort
needs to be placed elsewhere as well.
Let's keep playing fun with numbers!
What is the effect on your Gross Revenue if we were to increase your closing
ratio by 20%? Therefore ClosingRatio = (5% x 1.2) = 6% (Which is just
increasing it by 1%)
(10 + (100 x 6%)) x $1,500) = $24,000
The same increase of 6% in profits. Therefore, it seems that working on
increasing our closing ratio makes more sense. Is it harder or is it easier?
That is to be seen. Let's keep going.
What is the effect on your Gross Revenue if we were to increase your average
sale by 20%? Therefore AverageEngagementRevenue = ($1,500 x 1.2) = $1,800
(10 + (100 x 5%)) x $1,800) = $27,000
Increasing Average Engagement Revenue goes directly to the bottom line. An
increase of 20% results in
a bottom line increase of 20%. So here is where your first priority should be.
Now, let's move to the next step. What happens if we combine all the 20%
increases together?
(10 + (120 x 6%)) x $1,800) = $30,960
The increase is 37.5%. Which is significant and is the goal. To achieve the
goal I promised you, you need to do is learn strategies to increase your number
of prospects, increase your close ratio, and increase your average engagement
revenue. All strategies I can and will teach you.
Why is Zale providing this stuff absolutely free?
There are several reasons.
1. Ego. I love to teach and help people. I love it when people say, Zale
helped me. That is why I am continually asking people for LinkedIn
recommendations and asking people to add comments around my websites.
2. Reputation. I am a writer, consultant, and speaker. This course is one of
the strategies I am using to increase my to introduce my teaching and training
skills to thousands of people. (This will also
increase my prospects.)
3. Builds interest in www.ZaleTabakman.ca. (This will increase my reputation)
4. This Is Free Sample of what Zale can do. A strong technique for selling
services and products is offering free samples. I have a class room course I
teach and am planning on launching an online course, several books, several
e-books, and products through Itunes (The ultimate result will be an increase
in prospects, increase in closing ratio, and as people purchase more products
from me, an increase in average revenue)
You have had your introductory lesson. I have taught you how The Magic Profit
Formula and I have shown you how I applied one strategy (a free e-mail course)
to increase my prospects and my closing ratio.
I have received some questions via e-mail about this stuff.
What if I already know some of the techniques Zale is going to teach me? I am
teaching only a few techniques out of hundreds available. Each e-letter is an
application of a strategy which is a
combination of different techniques from other people. Whenever possible in the
Recommended Further Actions of the lecture I provide my sources. Therefore, you
can go directly to the source material and to learn other techniques and to
apply them.
Do I need skills to implement everything? As a consultant we have assumed you
have some certain basic skills. The better honed your skills are, obviously the
greater your increase in revenue will be, and the faster you will increase your
revenue. Use the Recommended Further Actions to identify places where you can
improve your skills.
What If I Want To Increase My Revenue By Greater Than 37.5% Annually? You will
need to do more than the techniques I will teach you. Many people are happy
with a 37.5% annual increase in revenue since they can't handle all the changes
that will be required by the increase in work. However, if you can grow faster
than that, the Recommended Further Actions section will show you how.
Are There Any Short Cuts
to the 37.5% Increase In Revenue? This question usually means that your
business has money to invest to get a larger return, I recommend hiring
somebody to implement each of the strategies suggested in the course. The
larger the number of people you have doing the necessary work the faster the
achievements.
Pretty simple, eh?
You can find this article online at
http://www.zaletabakman.ca/2008/09/11/the-magic-formula-to-increase-consulting-revenue-by-375-annually-first-in-a-series/
Take Care
Zale
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