Small Business Articles from Make-it-Fly®
Steps to Stop the Cash Flow Roller Coaster
is the Key
By Victoria Munro
your sales are going through the roof and then suddenly
they come to a halt, the work disappears and
you must scramble to start your marketing cycle from
scratch again. This economic roller coaster ride is
all too common for small business owners.
Landing one or two very large clients
can provide consistent work and cash flow but presents
a potential danger, too. Putting all your eggs in one
basket and focusing on these, while failing to prospect
for new clients, isn’t always wise.
The roller coaster problem is compounded
by the fact that small business
owners are often required to wear many different hats
at the same time: meeting deadlines, addressing
client concerns or employee demands, and dealing with
cash-flow issues. On top of this, there are personal
and family matters, which can be inescapable when working
from a home office.
When you’re busy and the business
is humming along nicely, it’s easy to neglect
the very thing that got the sales going in the first
place. Then, when sales drop off, panic sets in again.
How can you turn this feast-or-famine
cycle into a smooth, stress-free ride?
The Solution: Seven Steps to Keeping
Your Sales Pipeline Filled and Flowing
sales cycle as a funnel, wide at the top and
narrow at the bottom. You need to keep as many prospective
clients as possible entering the top of your funnel,
then filtering down to your required number of new clients
and signed contracts coming from the bottom. The idea
is to always keep a constant stream of prospects entering
Decide How Many New Customers
or Sales You Need Each Month
What number would be ideal? What is the minimum number
of clients (and sales revenue) you can get by with?
How many is too many, and could strain your resources
and compromise your service?
clear about who you are marketing to.
If you haven’t done so already, create a profile
of your ideal customer.
Understand Your Sales Cycle
How many initial prospects do you need to contact in
order to make a presentation? How many presentations
do you need to make to gain one new client? What is
your closing ratio? It boils down to a numbers game.
Step Three: Select
Activities to Meet Your Prospects
Based on the number of initial contacts that you need
to make, how many networking events will you need to
attend, flyers will you need to mail, calls will you
have to make?
What sort of prospect-generating activities will work
best for you, fit your personality and put you in front
of your target clients?
Remember: When you’ve
made these contacts, stay in touch with them, nurture
them and keep your name in front of them.
Step Four: Your
In order to plan and predict cash flow, you need to
understand the timing of your sales cycle. What is the
average length of time from the initial contact to closing
the sale and signing the contract or selling your product?
Step Five: Your
Establish a marketing budget. Be aware of the cost in
time as well as dollars. A series of print ads in the
local newspaper or trade journal may cost thousands
of dollars, but take very little of your time; whereas
attending networking events is relatively inexpensive,
but will take many hours of your time. Don’t forget
to compare the cost of gaining a new customer versus
the cost of marketing to existing customers.
Step Six: Decide
on Your Marketing Strategy
Select marketing activities that fit your budget, your
available time and your personality. Consistency is
key – make marketing activities part of your daily
Be selective: You
can’t do everything, so choose a few activities
that will work well for you.
Be realistic: Choose
activities that you will do without procrastinating.
Know yourself, and if you have issues that may sabotage
your plan, you have two options:
a) Get help and change
b) Hire someone else to do it
Be creative: Don’t
just stick with what is familiar or comfortable. Try
something different – think outside the box. Choose
more than one marketing approach.
Study other companies that are marketing successfully,
talk to those responsible and find out what they’re
doing, and how and why it’s working well for them.
Step Seven: Track
Your Progress Regularly
Evaluate how well your plan is working. Find out which
marketing methods are the most effective and are producing
the best return on your dollar and time. Keep a log
in a simple spreadsheet and track everything.
After analyzing their marketing results, a maid service
discovered that their expensive display ad in the Yellow
Pages generated inquiries only during the peak season,
when they were already working at maximum capacity.
However, less-expensive, but attractive door hangers
with a discount coupon produced long term clients in
just the right neighborhoods, enabling their teams to
be more efficient.
The Bottom Line: Balance and
Your current customers need your attention too. Servicing
them is a priority. However, you can never afford to
“put marketing on the back burner for now,”
which can be especially tempting if you don’t
enjoy marketing. With limited time available, you must
become as well organized, efficient and resourceful
as possible. Use technology to your advantage; create
and maintain a good database to communicate with customers
and prospects. Employ the best possible contact management
software for a business of your type and size.
Never buy into the misconception that you only need
to market during slow times. No
matter how busy you are, continue marketing.
To stay ahead in business and avoid stressful cash flow
ups and downs, marketing activities
must become a regular part of your week.
Set up your marketing plan, faithfully follow it, and
enjoy a smooth, hassle-free ride!
© 2005-2007 Victoria Munro.
for printable version.
About the Author: Victoria Munro is
co-founder (along with husband Dave Block) of Make-it-Fly®
LLC, a company dedicated to creating success for
small-business owners through creatively designed programs
and tools. Victoria has started and run nine different
businesses. To receive FREE business success articles
with tips to help you with your business, sign up for
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