Top Ten Questions Every Business Owner Should Be Able to Answer Brad Dawson, LTV Dynamics

Copyright Materials This presentation is protected by US and International Copyright laws. Reproduction, distribution, display and use of the presentation without written permission of the speaker is prohibited.

Learning Objectives 1.Participants will learn the ten top questions every business owner should be able to answer; 2.Participants will learn the “right” answers to these questions in both a normal economy and a recessionary situation; 3.Participants will be able to immediately implement at least 3 tactics into their business at the end of this presentation!

Are You Winning the Sales War?

Current Condition Will you win at least 80% of your current proposals?

Current Condition Besides low price, how do you expect to win?

Current Condition Are you reacting to the market or do you have a proactive strategy?

#1 What Do You Do Best? Best is defined as those customer activities that have been successful

#1 What Do You Do Best? Mature business owners evolve through markets over time based on market conditions and luck

#1 What Do You Do Best? If you don’t believe you are the best, why would anyone buy from you?

Recessionary Tidbit #1 Now is the very best time to explore becoming “best” in a new venture or offering. Chaos breeds opportunity and, oh boy, do we have economic chaos.

#2 Why Do Customers Buy From You? The reason a customer buys from you typically comes down to one of three things: increase revenues, decrease costs, mitigate risks

#2 Why Do Customers Buy From You? To reduce the cost of carrying their “assets” themselves

#2 Why Do Customers Buy From You? Mitigating risk to ensure freight moves seamlessly across international borders

#2 Why Do Customers Buy From You? Core offerings are associated with delivery excellence – not price – as non-performance is a far greater issue than low cost

Recessionary Tidbit #2 Ask your customers why they are buying your services – after, of course, they have paid their bill. Their insights may be a great way to sell your services to your next new customer!

#3 What is the Value of Your Portfolio? Do you rely on the customer asking you for what they want or do you anticipate their needs?

#3 What is the Value of Your Portfolio? What can you sell to your existing customers that precludes your competition from gaining a foothold?

#3 What is the Value of Your Portfolio? What is the value of all your offerings?

Recessionary Tidbit #3 Look at building the diversity of your offerings portfolio. The goal is to keep existing customers happy – even when it means going outside your previous comfort zone. Nothing ventured, nothing gained!

#4 What is Your Revenue Per Customer Metric? You have 3 types of offerings: assessments, implementation and maintenance.

#4 What is Your Revenue Per Customer Metric? Rule of thumb: you should be able to grow a customer relationship to be worth 10X your initial project

#4 What is Your Revenue Per Customer Metric? Or, the value of your AIM portfolio!

Recessionary Tidbit #4 Identify services that will double the value of your revenue per customer metric through exploring partnerships with trusted businesses. Use these relationships to leverage more revenues from your customers and gaining new customers from your trusted partner

#5 What % of portfolio is sold to every customer? On average, you are probably only selling 6% of your total portfolio to every customer

#5 What % of portfolio is sold to every customer? In a normal economy, I would tell you to reduce the number of customers – as 80% of sales comes from 20% of customers

#5 What % of portfolio is sold to every customer? Not being normal times, look for unique ways to “service” the asset

Recessionary Tidbit #5 The asset is the customer’s inventory or those “articles” that must be moved throughout the world (i.e., association tradeshow materials). Identify ways to leverage the asset – as the customer may change over time

#6 Who is Your Customer? Your customer may have changed over the last several months

#6 Who is Your Customer? In an aggressive bid environment, the customer is clear – so is the competition

#6 Who is Your Customer? Is it worthwhile to “give away” services to obtain the customer relationship?

Recessionary Tidbit #6 The objective for 2009 is to build your customer base – assuming you can absorb the cost of providing services at a discount. This approach ensures you are perfectly placed when the recession ebbs

#7 Can You Define Your Ideal Customer? “Ideal” is defined as the entity that will buy at least 80% of your services portfolio

#7 Can You Define Your Ideal Customer? Identify those common characteristics that make-up your 5-10 best customers

#7 Can You Define Your Ideal Customer? Aggressively acquire and retain these types of ideal customers

Recessionary Tidbit #7 Acquiring customers through traditional channels may be time and cost-prohibitive during this recessionary period. Look at partnering with firms that maintain a customer base that meets your ideal requirements and seek ways to share customer revenues.

#8 How Long is Your Current Sales Cycle? By the time an RFP hits the streets it has already been informally competed by several firms

#8 How Long is Your Current Sales Cycle? What changes are occurring in your industry that make the future uncertain for your customers?

#8 How Long is Your Current Sales Cycle? Are there maintenance and assessment projects that you can provide to your customer base now?

Recessionary Tidbit #8 Smaller firms may want to find teaming partners to decrease sales cycle for new customers. Use AfA contact networks and programs to establish face-to- face partnerships now.

#9 Who Owns the Customer Relationship? Often there is confusion as to who is responsible for the continuous interaction with the customer

#9 Who Owns the Customer Relationship? Too often, customers are forgotten after an activity is completed and never really leveraged for future work

#9 Who Owns the Customer Relationship? Train your customer-facing personnel to identify potential opportunities while on site with a customer and seek initial ways to “sell the work”.

Recessionary Tidbit #9 With the slow-down in work, aggressively seek to up sell your services. Fewer customers will want the services making the process even more like looking for a needle in a haystack – but persevere

#10 Have you ever lost a deal on price? If you have ever lost a deal on price – congratulations!

#10 Have you ever lost a deal on price? Real customers evaluate quality, experience and proven capabilities to minimize their risk

#10 Have you ever lost a deal on price? Realize that profits may need to “dip” and you should aggressively be seeking to reduce your overhead – but rarely is there value to sell your services at a loss!

Recessionary Tidbit #10 The exception to the sell at a loss rule is when the opportunity provides a strategic value to your firm (i.e., marquee customer) Realize that most customers brought on at a discounted rate, expect that rate to continue forever!

Thank You! Contact Information: Brad Dawson LTV Dynamics